India: South African thermal coal offers rise w-o-w despite muted buying interest

• Increase in sponge iron prices pushes up RB2 offers
• Cautious buying, high domestic supply may cap further rise

India’s portside offers for South African thermal coal – RB2 (5500 NAR) – rose by INR 200-300/tonne (t) w-o-w, supported by higher sponge iron prices and slightly improved trader sentiment. A recent deal for 500 t of RB2 was concluded at INR 7,500/t exw-Krishnapatnam. However, most buyers remained cautious, noting that ample availability of linkage and domestic coal at lower effective costs, except for maintenance charges, may cap further upside.

Meanwhile, portside thermal coal inventories in India were largely stable at 15.92 mnt in Week 27 against 15.86 mnt last week, as steady arrivals matched slow offtake.

Sponge iron prices show mixed trends

India’s sponge iron market witnessed mixed trends, with pellet-based prices staying largely stable, while lump-based tags rose by INR 100-200/t in Ramgarh, Mandi Gobindgarh, and Raigarh. Exw-Rourkela offers hovered at around INR 25,000/t. Despite higher quotes, most buyers preferred to wait, citing prior bookings at lower levels.

Export offers increase

South African export offers increased, with RB2 (FOB Richards Bay) assessed at $67.5/t and RB3 at $56.5/t, both up by $0.5/t.

Domestic coal prices unchanged; SECL auctions see low volumes

Domestic coal prices stayed stable w-o-w, with BigMint’s assessment showing 5000 GCV and 4500 GCV grades at INR 4,700/t and INR 4,250/t exw-Bilaspur. Market activity remained subdued, marked by scattered offers and limited fresh buying interest. SECL’s recent auctions offered lower quantities, which drew a modest response, mainly from existing players, and overall sentiment stayed weak amid thin demand.

Outlook

Portside prices may stay supported near current levels due to firmer sponge iron demand, but high domestic supply and muted fresh buying could limit sharp gains. Export-driven volatility remains a key watch point.