South African Coal Prices Remains High

South African Thermal coal offers remained unchanged this week at higher side despite falling Indian demand at present.

South African thermal coal 6000 NAR offers to hover at USD 58/MT, FoB Richards Bay for Jul’16 loadings. South African coal offers continue to remain volatile this month. Prices showed a marginal fall last week and again is offering at previous higher level for Jul’16 shipments.

On the other side, South African coal forward trading is showing on the higher side for Aug’16 and Sep’16 loadings. Currently, there is lack of spot cargo availability  also it is expected to make supply tight  more next month (rail maintenance) which would limit tonnage available for exports.

India, one of the largest buyer of South African coal has slowed down its regular buying now owing to continue rising offers on lower bid expectations in the market. Meanwhile, due to falling demand in India the grade is mostly booked in Capsize and Panamax vessels by many Sponge and power utilities for splitting purpose.

5500 NAR coal is available at USD 56-57/MT, CFR at Dhamra and Vizag/Paradip Port for Jul’16 loading. While, South African 6000 NAR offers are heard at USD 65-66/MT, CFR at the same ports.

South African coal 5500 NAR Panamax is being traded at USD 65/MT, CFR at Kandla Port for Jul’16 loadings. While, 4800 NAR coal is being offered at Mangalore Port at USD 44-45/MT CFR, Jul’16 loadings.

However, low CV South African material 4800 NAR is available at USD 47/MT, CFR Indian ports.

One West Coast based trader mentioned, “Continuous rise in South African coal offers resulted in slowing Indian buying interest. South African coal prices have remained at an elevated level, on the other side competitively priced coal from different sources influencing Indian buyers to take few trial shipments.”

At present, ready to sell material of 5500 NAR coal is available at INR 4,800/MT at Gangavaram Port. Whilst, the same grade material is being offered at INR 4,600-4,700/MT (all duties and clearance included, taxes will be added further) at Kandla Port.