Indian met coke prices remain stable this week, bids drop further

Merchant coke plants experience production cutbacks

Chinese coke market accepts fifth price cut, anticipates sixth reduction

Indian met coke prices have been recorded at INR 34,000/tonne (t) ex-Jajpur this week. Prices remained unchanged w-o-w, reflecting subdued trading activities in the market. Some merchant coke oven plants are operating below capacity and are choosing to blend imported met coke, given the decline in imported offers. Cokeries continued to grapple with high levels of coking coal, resulting in reduced purchases. Moreover, there is a noticeable lack of demand for both coking coal and PCI grades. Few cokeries have also put to halt temporarily on reduced buying activities.

Coking coal offers

Australian premium hard coking coal prices dropped by 24% w-o-w to $232/t FOB and $291/ t CNF on 16 March, 2024 amid oversupply of material. This drop was accompanied by a downturn in the paper market, prompting expectations of further weakening. Market observers noted aggressive selling behaviour, with multiple offers made to end-users. Despite this, remaining market offers remained steady. According to market participants, a trade of 40,000 t was heard to have been concluded of Australian premium mid-vol Illawarra coal at $270/t FOB Australia for 1-15 April loading.

Imported coke prices

Chinese met coke prices were assessed at $344/t CNF India, for 65% CSR, CFR India. China's met coke producers have accepted the fifth round of price cut on 16 March 2024 prompted by steel mills in Hebei and Shandong provinces facing depressed margins. Met coke prices in Hebei's Tangshan were assessed at RMB 1,960/t ($276/t), a fall of RMB 100/t ($14/t) w-o-w. Sellers with FOB China cargoes remained cautious, adjusting their offer levels conservatively. Despite a slight decrease in collected offers amid anticipation of the sixth price cut, Indonesian coke prices held steady internationally, reflecting producers' efforts to regain margins after previous raw material price hikes.

However, the recent decline in prime coal prices may soon prompt downward adjustments in coke offers. Consequently, CFR India prices are anticipated to soften for end-April to May shipments.

Pig iron market

Indian pig iron prices dropped by INR 200/t w-o-w and were assessed at INR 38,100/t DAP Durgapur on 18 March 2024. Moreover, prices dropped by INR 100/t w-o-w in the Raipur market and are currently assessed at INR 37,250/t DAP- Raipur.

Outlook

Domestic met coke prices are anticipated to decline due to the persistent availability of competitive offers and reduced purchasing activities. Furthermore, the allure of declining imported prices is drawing end-users towards imports, possibly leading to a downward trend in domestic coke prices in the near term.