The South African thermal coal market appears to be gradually recovering, as Indian demand for Indonesian thermal coal continued to slump on the ground of competitive pricing arbitrage on mid-calorific value coals originated from other origins, especially South Africa.
In addition, increased purchases from domestic utility Eskom has further tightened supply of the commonly exported grades 4,800-5,500 kcal/kg NAR.
Notably, the South African thermal coal market has been witnessing re-emerging demand from main export market India, following prolonged weeks of price declines.
This resurgence in demand has largely prompted the India-based sellers to considerably lower discounts issued for 5,500 kcal/kg NAR coal on the 6,000 kcal/kg NAR price.
Nevertheless, Indian thermal coal demand might be losing steam in the coming weeks following the end of the general election and the onset of the monsoon season.
PRICE ASSESSMENTS
RB1 (6,000 kcal/kg NAR) coal is assessed at around USD 71.40/MT FOB Richards Bay.
RB2 (5,500 kcal/kg NAR) coal is assessed in the range of USD 59-60.90/MT FOB Richards Bay.
RB3 (4,800 kcal/kg NAR) coal is assessed in the range of USD 45.90-47.50/MT FOB Richards Bay.
For Indian buyers, the above offers amount to USD 84.40, 72.95 and 59.70/MT respectively, after charging an average freight rate of USD 13/MT for delivery by Panamax vessel class.
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