India: BigMint's coking coal index declines by $11 on global market shifts

BigMint's newly launched coking coal index for premium hard coking coal (PHCC) was assessed at $200/tonne (t) CNF Paradip, India, as of 16 September 2024. The index fell by $11/t against the previous assessment on 31 August 2024, in which prices were recorded to be at $211/t CNF India.

Falling global prices of coking coal and steel have weighed on India's coking coal prices.

"Coking coal prices have corrected sharply since the beginning of this month, resulting in some Indian buyers exercising caution while placing bookings. They anticipate further price drops," highlighted a western India-based steel player.

"Benefits from the fall in coking coal prices have been offset by a decline in steel prices. As most bookings are done on a long-term basis, there should be less impact by way of volatility," stated an Indian mill.

India's coking coal imports fall in Aug'24

India's coking coal imports were recorded at 5.8 million tonnes (mnt) in August 2024, lower than the 6 mnt recorded in July 2024, as per data compiled by BigMint. Australia continued to be the leading source of imports in August, followed by Russia and the US.

Rationale-

• BigMint's coking coal index is derived using data points, i.e., trades, offers, and bids. To download the detailed methodology, click here.
  
  
• No deals have been reported so far in this publishing window. Thus, the T1 trade category was accorded 0% weightage.
  
  
• Ten (10) firm offers, bids, and indicative prices were heard. Eight (8) were taken for price calculation and given the balance 100% weightage.
  
  

Factors impacting global coking coal prices

1. Australian coking coal prices drop in Sep'24: Australian PHCC prices declined to $181/t FoB Australia, yesterday (15 September 2024) as against $198/t, FoB at the end of August 2024. Prices reduced amid weak sentiments in the steel market and the downturn in the international coke market. In addition to these factors, the approaching holidays in China also kept offers on the lower side. Moreover, a fall in futures, along with demand concerns in major buying countries, weighed on offers.

2. China's crude steel output declines: China's crude steel production for August 2024 stood at 77.92 mnt, reflecting a 10.4% y-o-y decline from 86.41 mnt in August 2023, according to data from the National Bureau of Statistics (NBS). Bid-offer disparities and falling steel prices globally weighed on coking coal prices in all major countries. Additionally, coke price cuts in China and the ongoing monsoon season in India have adversely affected inquiries.

3. China's Hebei steelmakers initiate 8th round of met coke price cuts: Some Chinese steel mills in Hebei, including the Tangshan area, initiated their eighth round of price cuts for met coke, reducing their purchase bids for the material. Prices of wet quenched met coke were reduced by RMB 50/t ($7) and of the dry quenched variant by RMB 55/t, effective from 10 September 2024.