Indian met coke prices remained stable w-o-w. Current offers for blast furnace grade met coke (25-90mm) heard at INR 43,000/t ex-Jajpur. However, prices have dropped marginally compared to February, 2023.
Coking coal prices were recorded at $341/t, FOB Haypoint, Australia as against $368/t FOB for February 2023. Prices fell amid easing of supply constraints from Australia’s Queensland. Indian mills held orders and new purchases as of now and waiting for further price correction in met coke market which is expected to come as a result of falling coking coal prices in the international market.
“Chinese met coke prices of around $433/t CNF Hazira would be viable for steelmaking compared to the current domestic offers. Chinese coke prices are competitive compared to the domestic coal. Hence, steel mills would prefer more of imports than the domestic coal,” a source said.
However, Chinese coke plants are trying to increase prices of their products by cutting down production, as per recent reports. Chinese coke chemical companies planned to cut production by 30% to raise coke prices. Resumption of coking coal exports from Australia in the first week of February has weighed on domestic coal and coke prices. The Chinese government has now lifted the unofficial ban on Australian coal for all companies compared with just four State-owned companies, previously.
India’s met coke production dropped by 24% m-o-m to 2.87 million tonne (mnt) in February 2023 as against 3.76 mnt in January 2023, according to data maintained with CoalMint. Out of total production, merchant met coke output was 0.22 mnt, down 33% m-o-m while captive production was 2.69 mnt, down 22% m-o-m.
AM/NS India is setting up its own coke oven plants for captive consumption. A source informed that AM/NS India is yet to have a coke oven plant, making it fully dependent on the merchant coke market. Here, prices can get volatile and are often governed by global developments. The mill was producing steel by purchasing met coke from the domestic and overseas merchant markets. AM/NS India’s purchase volume of imported met coke is around 1 mntpa, as per data maintained with CoalMint.
India’s steel scenario
India’s finished steel production stood at 9.87 mnt in February. Production dropped by 8% m-o-m as against 10.93 mnt in January. Nevertheless, production inched up by 3% y-o-y compared to 9.59 mnt in the preceding year.
Finished steel production rose by 6% y-o-y to 109.352 mnt during April-February as against 102.999 mnt in the same period last year.
Outlook
Indian met coke prices may witness a drop in coming months as imports at current levels are more lucrative. However, with Chinese mills planning to raise prices of met coke, imports viability in India may reduce in upcoming months.
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