Seaborne metallurgical coke prices continued to retreat amid lower offers seen in the last few weeks to draw buying interest from Asian buyers.
CoalMint currently assesses the spot price for the 64% CSR grade blast furnace met coke at $429/t CNF India, down $5/t w-o-w.
The 62% CSR grade BF met coke is currently assessed at $421/t CNF India — also down by $5/t w-o-w.
Until last month, however, global met coke prices were underpinned by persistently strong demand in the Atlantic-region and high pricing in China.
In spite of the Chinese domestic met coke market remaining range bound amid thin activity during Lunar New Year holidays, coke price did not lose support post-holiday as downstream steel prices were relatively steady. Nevertheless, there were expectations among certain market participants that Chinese met coke prices may adjust downward.
But after the February 11-17 Chinese New Year holiday, some downward pressure emerged, particularly with coke prices in China being subjected to five cuts amounting to CNY 500/t.
Fifth round of price cuts in China’s coke market—
In the Chinese domestic coke market, the fifth round of price cuts were proposed on 15 March by CNY 100/t. This would bring the total price cuts to CNY 500/t, since the first round was proposed mid-February.
Market participants said they expect more downward pressure on raw material prices amid Tangshan’s short-term output reductions at local blast furnaces. They also said that the corrections in coke prices were expected amid an imbalance of profit margins between coke plants and steel mills.
Previously, a proposal for price cut by CNY 100/t had been raised on 1 March from major end-users in Hebei and Shandong. This was the second round, with the first round taken place in the last week of February.
Indian buyers stay clear of import market in anticipation of near-term price cuts—
In India, relative weakness in domestic steel prices in recent weeks has pushed some buyers to the sidelines. Many Indian buyers have adopted a wait-and-see attitude in anticipation of near-term price cuts, citing that import prices were long due for a correction. Hence, some sources anticipate that domestic coke prices may also retreat in the near term.
However, declining coke inventories and supply crunch will continue to support domestic coke prices in India, several market sources stated.
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By Aditya Sinha
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