Indian met coke prices edge up on rising coal prices

Indian met coke prices edged up to INR 34,000/t as against INR 33,500/t ex Jajpur last week. Coke prices inched up on increasing coking coal prices.

Indian steelmakers have been looking for cargoes while PMV supply remained tight. Besides, limited availability of PHCC and mid-volatile cargoes by Australian miners, which is the most preferred by Indian steel mills, has led to procurement at higher prices. End-users have little choice but to accept current prices in a fast-rising market to secure cargoes to continue running their facilities.

India's met coke imports in August picked up to 0.23 million tonnes (mnt), as per CoalMint data. Imports picked up m-o-m compared to 0.18 mnt in July. In fact, imports dropped to monthly average levels in July and August after the sharp hike in June.

Coking coal offers

Australian premium hard coking coal (PHCC) prices increased by $40/t to $312/t FOB on 13 September, 2023 as against $272/t last week amid limited availability. Prices have risen sharply due to scarcity of cargoes due to suspension of production at BMA's mines following recent news of accidents. A major deal was concluded by an Indian mill for 40,000 t of Goonyella mid-volatile premium coking coal which has provided the sudden push to prices. The deal was concluded at $321/t FOB Australia, with 21-31 October laycan. However, amid limited supply of PHCC, more mills may start to consider swapping out their met coal procurement to consider met coke instead due to cost effectiveness.

Imported coke prices

Chinese domestic met coke market continued to rise amid robust restocking due to talks of production cuts and a round of price hike is expected following hike in domestic coal prices. Chinese met coke producers are planning to increase prices as merchant cookeries are facing weak margins and hence will raise export offers. The safety checks on Chinese mines and end-users restocking demand ahead of National day holidays have instilled price. Effective prices of met coke in Hebei's Tangshan were assessed at RMB 2,060 ($282/t). Chinese met coke prices were at $330/t CNF Hazira, up $7 w-o-w.

Pig iron market

Indian pig iron prices were recorded at INR 41,000/t yesterday. Prices have picked up by INR 200/t as against INR 40,800/t a day ago.

Outlook

Indian met coke prices may see an uptick in near-term on rising coal prices in international market following cargoes availability crisis. Also, amid low price differential between coke and coal, many end-users may shift to procurement of coke directly on cost effectiveness.