Indian met coke prices move up marginally w-o-w
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- Domestic cokeries raise prices on DGTR import restriction
- Indian buyers submitting low bids for imported coke
Indian met coke prices have edged up to INR 33,500/tonne (t) ex-Jajpur, recording an increase w-o-w. Prices have picked up slightly as demand has emerged from buyers. Also, another reason is the implementation of DGTR recommendations which are yet to be imposed.
Met coke prices in western India have remained stable. Production has been reduced, with Indian cokeries cutting their output. Consequently, met coke capacity utilisation in western India has decreased to around 50%. Indian met coke production dropped 11% m-o-m in April 2024. Captive production was recorded at 3.37 mnt and merchant producers contributed 0.47 mnt last month.
Indian coke imports have been recorded at 0.28 mnt in April as against 0.22 mnt in March, as per data maintained with BigMint.
Coking coal prices
Australian premium hard coking coal (PHCC) prices dropped w-o-w to $235/t FOB against $241/t FOB a week ago. Asian metallurgical coal prices have declined due to depressed market sentiments from end-users and reduced selling activity observed from traders. Buying interest from India is only around $230/t and no one is in a rush to buy at the moment.
There remains downward pressure in the market, particularly for June laycan cargoes, as traders will need to keep lowering their offers to offload unsold stock amid weak demand. Indian bids were heard at levels of about $230/t. In the CFR China market, prices also declined due to lacklustre buying activity.
Chinese buyers are not rushing to trade at this point due to a lack of clarity over market direction. This hesitation is particularly influenced by market speculation that China might unveil stimulus measures to support the residential property market.
Imported coke prices
Chinese met coke prices have currently dropped 6% to around $319/t CFR India. Chinese mills are on the way to enhance production. The rise in production may pull down prices going forward.
The Energy Administration of Shanxi province, China's top coal mining hub, has approved a local coal miner Pingshu Coal Industry Co., Ltd. to increase production capacity at its Wenjiazhuang Coal Mine in Shouyang county, Jinzhong city, to 5 mnt/annum, a huge jump from the mine's previous capacity of 900,000 t/year, announced the firm's parent Shanxi Huayang on 14 May.
In 2023, Shanxi province had added a total of 48 mnt/year of coal production capacity as of end-September, data from its Energy Administration show.
In the 65% CSR met coke segment, prices continue to decline amid increasing speculation about potential Chinese coke price cuts. Prices on an ex-stock basis have seen a significant downward correction, as sellers anticipate lower offers if the price cut materializes next week.
As the coal and coke markets are currently declining, end-users have been indicating lower bids than what sellers would prefer. This has created a dilemma and a pause in trades at the moment.
Indian pig iron (steel grade) prices fell by INR 1,300/t w-o-w to INR 42,300/t Durgapur on 17 May. Similarly, prices fell by INR 650/t w-o-w in the Raipur market to INR 43,000/t DAP.
