India: South African portside coal prices dip further in recent deals

• Thermal coal inventories at ports stable w-o-w
• Sponge iron dips further on falling steel, billet tags

South African coal prices at Indian ports fell further this week on tepid buying, higher domestic availability, and freight pressure amid a crude oil price surge. RB2 (5500 NAR) dropped by INR 100/t w-o-w to INR 7,700/t exw-Gangavaram, while RB3 (4800 NAR) declined by INR 50/t to INR 6,800/t. At Vizag, RB2 and RB3 were assessed at INR 7,650/t and INR 6,650/t, respectively.

Deals for around 55,000 t of RB2 were pegged at INR 7,450-7,600/t exw at Dhamra and Gangavaram ports. Export prices stayed soft this week, with RB2 down by $1/t to $70/t FOB and RB3 falling by $2/t to $58/t FOB.

Thermal coal inventories at Indian ports remained largely stable at 15.35 million tonnes (mnt) in week 23 of CY’25, down marginally by 0.3% from 15.39 mnt in Week 22.

Domestic coal, sponge iron markets stay bearish

Domestic coal prices remained under pressure this week amid sluggish demand and adequate availability. As per BigMint’s assessment, the 5000 GCV grade declined by INR 50/t to INR 4,700/t exw-Bilaspur, while the 4500 GCV remained stable at INR 4,250/t. Bids have come down further in recent SECL auctions, reflecting limited buying interest.

Sponge iron (CDRI) at Rourkela dropped by INR 200/t to INR 24,200/t exw. The downtrend in sponge iron prices persisted, as buyers remained cautious in an uncertain market. PDRI prices closed within the range of INR 21,700-25,000/t, while CDRI tags settled at INR 24,200-29,100/t. Buyer caution prevailed in a declining market, resulting in modest transaction volumes.

Outlook

Coal demand will remain under pressure amid monsoon concerns and surplus supply. However, rising crude oil prices may tighten freight markets and support CNF prices. Any further rise in crude oil rates could limit price correction in thermal coal, especially if geopolitical tensions escalate.