The Atlantic seaborne metallurgical coal and coke markets are continuing to soften, under pressure from weaker output growth and low prices for steel in certain key markets, particularly in Europe.
With high stockpiles building at ports and steel mills in the Atlantic region, US coking coal producers are raising concerns that the excess raw materials availability may also temper spot seaborne pricing.
Traders and producers reported limited Atlantic spot market activity for seaborne coking coal, citing subdued demand from steel industry consumers in Europe.
Analysts concurred that the European market appears to struggle at the moment, with lower steel prices and higher input costs continuing to weaken the profitability and cash flow generation of steel producers.
European steel producers are facing economic pressure from various external factors – rising foreign imports due to ineffective trade protection measures, downturn in automotive manufacturing market, and increasing iron ore and electricity costs – having softened the country’s overall steel sector outlook.
PRICE ASSESSMENTS
The latest FOB US East Coast price of low-vol hard coking coal is assessed at USD 180/MT, based on 58% coke strength after reaction (CSR), 8% ash, 0.8% sulfur and 19% volatile matter material.
For Indian buyers, the above price amounts to USD 211/MT on CNF India basis, after considering a USEC-India dry bulk freight rate of USD 30/MT for delivery by Panamax vessel class.
The US high-volatile type A (HVA) coking coal price is assessed at around USD 196/MT FOB USEC, based on 7% ash, 0.85% sulfur and 32% volatile matter.
The US high-volatile type B (HVB) coking coal price is assessed at around USD 159/MT FOB USEC, based on 8% ash, 0.95% sulfur and 34% volatile matter.
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