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India: South African coal portside prices inch down as sponge iron prices head southward

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Non Coking

BigMint Bureau

162 Reads

22 Jun 2024, 13:14 IST

India: South African coal portside prices inch down as sponge iron prices head southward

Indian sponge iron prices down INR 1,050/t w-o-w

South African coal prices drop $2/t w-o-w

Prices of RB2 (5500 GAR) coal in the Asian thermal coal market fell INR 100/t w-o-w to INR 10,100/tonne (t) ex-Gangavaram. Prices of RB3 (4800 NAR) coal at Gangavaram Port were recorded at INR 8,300/t, down by INR 100/t this week.

A deal for RB2 was heard done at Vizag port for about 4,000 t at INR 10,150. Also, another deal of 4000 t Rb3 was heard concluded at Gangavaram port at INR 10,100/t. Rb2 offers in Gangavaram port were heard to be limited on scarcity of cargoes at the port.

Factors impacting prices

South African prices drop: Portside prices of RB3 (4800 NAR) coal have edged down w-o-w and are currently assessed at $78/t FOB. Also, RB2 (5500 NAR) coal prices fell by $2/t at $95/t FoB.

South Africa's coal line maintenance rescheduled-The difference between offers and bids in the Asian thermal coal market remained significant. According to sources, this was due to a lack of buyer interest, as already ample stocks existed in the country. Besides the beginning of monsoons in parts of the country has pulled down the buyers interest. On 14 June midnight, theft was reported in the section between Ermelo and RLRA, resulting in the closure of both lines. This disruption impacts services from Ermelo to the mines. The coal line annual maintainence shut down date has been rescheduled. The Coal Line Shutdown was initially planned to begin on July 9, 2024, and conclude on July 18, 2024. However, according to the revised schedule, the shutdown will now commence on July 23, 2024, and end on August 1, 2024.

Sponge iron prices fall-Sponge iron (P-DRI) prices fell by INR 1050/t w-o-w to INR 25,800/t exw Raipur on 14 June. Sponge prices are driven by a downtrend in the semi-finished steel.

Outlook

South African coal prices are expected to remain stable or see a downtrend on falling demand. Weak buyer interest during monsoon for thermal coal is expected to pull down prices further. However, the annual maintenance shutdown may give a little push to prices.