India: Portside RB2 drops by over INR 2,000/t w-o-w as imported coal prices slump
Portside prices of South African (SA) RB2 (5500 NAR) grade corrected down by INR 2,300/tonne (t) this week following an 18% w-o-w fall in imported South African thermal c...
Portside prices of South African (SA) RB2 (5500 NAR) grade corrected down by INR 2,300/tonne (t) this week following an 18% w-o-w fall in imported South African thermal coal prices.
RB2 portside trade prices for the current week
| Port | Nov'21 W4 | As on 2 Dec'21 |
| Ex-Gangavaram | 12,300 | 10,000 |
| Ex-Mangalore | 12,300 | 10,500 |
| Ex-Vizag | 12,300 | 9,800 |
Prices in INR/t, ex-cess and GST
At Haldia, offers for the same are being heard at INR 12,000-12,400/t ex-port basis.
According to market participants, sponge iron manufacturers are focusing on procuring RB2 as per requirement as prices are quite volatile with a downward bias. The demand for sponge iron has turned tepid since the past few weeks amid bearish sentiments in the steel sector. The price for P-DRI sponge iron is currently assessed at INR 27,500/t ex-Raipur (down by INR 1,400/t w-o-w basis).
Deals concluded
In various confirmed deals collected by CoalMint between 29 Nov'21-2 Dec'21, a total of 43,000 t of RB2 was traded at an average price of INR 10,000/t, ex-Gangavaram.
South African coal prices volatile
RB1 (6000 NAR) prices corrected sharply this week to $118.3/t as on 30 Nov'21, before rebounding to $132/t as on 1 Dec'21.
The fluctuations came against the backdrop of rising number of Omicron cases in Europe, raising concerns of a potential lockdown there and following the NDRC's announcement with regards to controlling rising coal prices in China.
The state planner recently said it would combine market and legal measures to rein in prices and would make adjustments once prices go out of range. Thermal coal prices in China so far corrected by over 50% since its peak of RMB 1,982/t in mid-Oct'21 on the Zhengzhou Commodity Exchange.
A sharp fall in RB1 prices, however, was limited as the current stock level at RBCT Port remained at 2.3 million tonnes (mn t), sharply lower than the average 5 mn t levels in past months.
The discounts for RB2 and RB3 are currently assessed at $14/t and $26/t respectively for December loading. Capesize vessel freight from RBCT to Gangavaram is at $16/t.
Short-term outlook
CoalMint believes, portside RB2 prices are likely to remain in a tight range replicating the ongoing volatility in the international market. Strong winter demand and limited stock at ports, however, are likely to limit any major fall in imported prices.
