India: Domestic met coke offers remain under pressure on global cues, weak demand

• Met coke import offers to India remain stable w-o-w
  
  
• Chinese coke price cut keeps Indian prices under pressure
  
  

Indian domestic met coke prices have declined this week amid low demand and limited buying interest. Prices fell by INR 100/tonne (t) w-o-w to INR 34,100/t, ex-works Jajpur. In western India, prices dropped by INR 500/t w-o-w to around INR 30,800/t ex-works Gandhidham. In southern India, prices were reported at INR 29,000 to 30,000/t ex-works.

The sluggish demand in India is partly due to the monsoon season and a downturn in the Chinese steel market, prompting Indian end-users to adopt a wait-and-see approach. As a result, cokeries have cut production to minimise losses, with some selling imported materials in the domestic market.

A source told BigMint: "Production of coke is down, and most of the supply is being imported from Indonesia and China these days."

India's met coke imports were recorded at 0.33 million tonnes (mnt) in August 2024, down from 0.42 mnt in July 2024. Indonesia was the largest supplier, contributing 26% of India's met coke imports for the month at 0.08 mnt, followed by Australia at 0.07 mnt. Major steel producers such as AM/NS, Tata Steel, and JSW Steel each imported approximately 0.04 mnt of met coke.

Meanwhile, a producer based in Eastern India recently sold around 20,000 t of met coke at prices ranging from INR 34,000-35,000/t ex-works Jajpur.

Factors weighing on met coke offers:

Imported met coke offers: Imported met coke offers to India are currently around $250/t FOB from Indonesia and $240/t FOB from China, with prices remaining stable w-o-w. Demand continues to be weak, and a boost in coke prices is anticipated only when there are signs of firming up in the market.

Chinese coke prices drop: Citing prolonged losses from selling finished steel, some steelmakers in North China's Hebei province and East China's Shandong province implemented a new round of coke procurement price cuts by yuan 50-55/t($7-7.3/t), effective from 29 August. End-users have delayed seaborne coal purchases, noting persistent declines in the futures market amid a bleak outlook for both the steel and coking coal sectors. With futures prices continuously dropping and domestic prices expected to fall further, Chinese end-users are cautiously adopting a wait-and-watch approach.

Coking coal prices fall: Australian premium hard coking coal (PHCC) prices fell by $2/t w-o-w to $194/t FOB. The decline in metallurgical coal prices was driven by sellers lowering offers for prime coal amid weak buying interest and a noticeable bid-offer disparity in the market. The sluggish demand from India is partly attributed to the monsoon season and a weak domestic steel market.In China, market participants remain cautious due to ongoing uncertainty. Reports indicate that Chinese mills are still showing limited interest in seaborne coking coal, opting instead to source from port-side inventories or delay purchases, provided prices remain competitive.

Outlook

Weak demand in the domestic market, coupled with competitive overseas import offers, continues to put pressure on the former, especially given the prevailing monsoon season.