India: Domestic met coke prices drop w-o-w on limited trades, subdued steel market sentiments

• Rumours of import restrictions emerge in India

  
  
  

• Chinese producers accept 4th straight price cut
  
  

India's domestic met coke prices dropped significantly this week. As per BigMint's assessment, the 25-90 mm blast furnace (BF) grade fell by INR 1,400/tonne (t) ($16.49/t) to INR 31,300/t ($368.7/t) exw-Jajpur, while Gandhidham's prices dropped down by INR 1,000/t ($11.8/t) to INR 28,400/t ($334.5/t). Market participants attributed the decline to reduced buying interest amid cautious sentiments in steel and allied sectors.

The market witnessed limited trades this week. A deal for about 10,000 t was heard concluded at INR 31,000/t ex-Jaipur.

Market overview

India's imported met coke market turns quiet: India's imported met coke market remained quiet this week, without any trades, after active bookings last week. This follows rumours of import restrictions via quotas. Offers from Indonesia were recorded at $250-255/t FOB, while those from China were assessed at $265-275/t FOB, sources informed BigMint.

China sees 4th round of price cuts: China's metallurgical coke market saw a price reduction of RMB 50-55/t ($6.9-7.6/t) generally materialise across the country on 9 December, after leading steelmakers in North China's Hebei and East China's Shandong joined their peers' push for lower procurement prices, Mysteel Global learnt from sources. This marks the fourth consecutive round of price reductions accepted by domestic producers. The downward pressure on coke prices was largely driven by the subdued downstream demand and poor profitability experienced by most domestic steelmakers, which prompted them to cut raw material costs in an effort to improve their financial standing.

Coking coal prices edged up w-o-w: Australian PHCC prices edged up by $2.25/t w-o-w to $204.25/t FOB yesterday. Prices rose on decent demand from India and Southeast Asia. Despite limited supply in the market, particularly for premium mid-vol coal, sellers indicated that they planned to withhold cargo until buyers met their price expectations. However, some traders observed that, despite the absence of new supply from miners, existing floating cargoes in the market appear sufficient to meet end-user demand. In China, opportunistic buying interest was reported, mainly from mills in the southern region. However, end-users did not display urgency in their purchasing decisions.

Indian pig iron prices fall w-o-w: Steel-grade pig iron prices in Durgapur fell INR 200/t w-o-w to INR 33,600/t exw. Additionally, tags in Ludhiana dropped INR 500/t w-o-w.

Outlook

The Indian met coke market is likely to remain under pressure in the near term, driven by subdued demand and cautious buyer sentiment in the steel sectors. Additionally, falling Chinese domestic coke prices have favoured the price drop in the domestic market. However, limited supply in the imported met coke and premium coal segments could provide some support to prices if procurement interest picks up.