India: Portside South African coal prices rise w-o-w

• South African seaborne coal prices edge up w-o-w
  
  
• Indian sponge iron prices fall by INR 450/t
  
  

Prices of RB2 (5500 GAR) coal in the Asian thermal coal market picked up w-o-w to INR 10,200/tonne (t) ex- Gangavaram. Prices of RB3 (4800 NAR) coal at Gangavaram Port were recorded at INR 8,400/t, up INR 100/t w-o-w.

Prices picked up recently due to train derailment and one of the rail lines has not yet resumed. Also, another reason being is scheduled maintenance which has added to supply pressure. This has resulted in bid-offer disparity in the market.

Deals this week

• A deal for 4,000 t of RB2 done at Gopalpur at INR 10,200/t towards beginning of the week
  
  
• Another deal was heard for 4,000 RB3 at INR 8,200 last week at Gangavaram port
  
  
• A deal for 4,000 t of Rb3 was heard concluded at INR 8400/t this week.
  
  

Factors impacting South African coal prices

• South African prices at portside: Portside prices of RB3 (4800 NAR) coal have remained stable w-o-w and are currently assessed at $79/t FOB. However, RB2 (5500 NAR) coal prices moved up to $97/t FOB.
  
  
• South African exports fell in May: South Africa's thermal coal exports dropped 10% m-o-m to 4.75 million tonnes (mnt) in May 2024 as against 5.27 mnt in April. However, exports dropped by 7% y-o-y to 4.75 mnt in May compared to 5.12 mnt in May. South Africa thermal coal exports to India stood at 2.19 mnt in May, down 16% m-o-m.
  
  
• Sponge iron prices fall

  Sponge iron (P-DRI) prices fell by INR 450/t w-o-w to INR 27,850/t exw Raipur on 7 June.
  
  

Outlook

South African coal prices may face upward pressure due to anticipated supply issues. In addition, many traders are not aggressively restocking ahead of monsoons which may affect imports in the near term.