Australian Coking Coal: PLV price edges up on fresh deal; weaker grades hold steady
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The FOB price for Australian premium hard coking coal (PHCC) has edged higher this week, with new bookings done on FOB basis; however, both CNF China and India markets have been silent.
A spot transaction for 75,000 t of an Australian premium low-volatile (PLV) cargo, with mid-October laycan, was concluded yesterday at $107/t FOB Australia.
Another PLV booking for 75,000 t, with early-October laycan, was earlier reported on Tuesday at $103/t FOB Australia -- thus indicating that there is still consistent demand for higher grades of coking coals by non-Chinese buyers.
Chinese Market Scenario--
Aside from the positivity seen in the FOB market, Chinese trading activity remained muted due to a persistent dearth of import quotas, coupled with customs-related concerns among buyers.
Concerns also emerged regarding the escalating trade tensions between China and Australia, which could potentially worsen the demand scenario for seaborne coking coal.
Other major ex-Chinese markets in the Asia-Pacific region continued observing limited spot demand from end-users, in spite of a considerable recovery in global steel production.
Indian Market Scenario--
The Indian market has been observing an increase in enquiries for seaborne coking coal, but other than the existing long-term contracts, no spot transactions were heard from India.
Although there has not been any significant improvement in steel product sales; production cuts have been largely withdrawn across much of the country's steel manufacturing plants.
Traders anticipate that imported coking coal demand would pick up soon, as the country is gradually opening up and most steel plants have resumed normalized operations.
Near-term Outlook--
The recent flurry of FOB bookings, in the premium coking coal segment, has modestly uplifted the outlook for seaborne coking coal in the fourth quarter.
However, prices may remain at current low levels until at least next month, when the Chinese end-users can start utilizing their import quotas for 2021.
Price Assessments--
Coking Coal
Latest offers for the Premium HCC grade are assessed at around $111.00/t FOB Australia, while offers for the 64 Mid Vol HCC grade are assessed at around $86.80/t FOB Australia.
For Indian buyers, these offers amount to $124.50/t and $100.30/t respectively on CNF India basis.
Pulverized Coal Injection (PCI) & Semi Soft Coking Coal
| FOB Australia | CNF China | CNF India | |
| Low Vol PCI | 67.05 | 79.25 | 80.55 |
| Mid Tier PCI | 65.05 | 77.25 | 78.55 |
| Semi Soft | 60.30 | 72.50 | 73.80 |
Prices in US Dollar per tonne ($/t)
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By Aditya Sinha
