India: Imported South African thermal coal prices drop despite falling port stocks

• Sponge iron prices rise w-o-w ahead of Budget
  
  
• Domestic coal prices inch up in recent auctions
  
  

Portside South African thermal coal prices in India declined this week due to limited inquiries and selling pressure on suppliers. RB2 (5500 NAR) coal prices dropped by INR 100/t to INR 8,700/t, while RB3 (4800 NAR) fell by INR 50/t to INR 7,250/t at Gangavaram Port. The decline in South African coal prices has contributed to the downward trend in prices.

Additionally, buyers are turning to existing inventories or opting for cheaper domestic coal alternatives. The drop in South African coal export prices has further contributed to the downward trend in domestic portside prices.

Thermal coal inventories at Indian ports dropped by 4% to 13.34 million tonnes (mnt) in week 4 of CY'25 from 13.89 mnt in week 3, as per BigMint's data.

Market overview

South Africa's export prices fall slightly: South Africa's RB2 (5500 NAR) coal export offers declined by $1/t w-o-w to $81/t FOB, while RB3 (4800 NAR) offers were stable at $61.5/t FOB.

Domestic thermal coal prices rise: Domestic thermal coal prices in India increased this week following the recent SECL auction. 4500 GCV coal was assessed at INR 5,000/t, up INR 250/t w-o-w, while 5000 GCV stood at INR 5,900/t, up INR 350/t, both exw-Bilaspur. Despite the price rise, coal trades remained sluggish as buying interest was limited.

Sponge iron prices rise: Sponge C-DRI prices were assessed at INR 26,200/t exw-Rourkela, up INR 600/t w-o-w.

Outlook

Portside South African thermal coal prices in India may see further decline as demand remains weak, especially from sponge iron manufacturers. The market is also facing selling pressure from traders looking to offload stocks amid limited fresh inquiries. While some buyers are still relying on domestic coal, any shift in purchasing patterns will depend on global price movements and upcoming import shipments.

Unless demand picks up significantly post Budget 2025, prices are unlikely to see a major recovery in the near term.