South Africa's non-coking coal exports up 6% y-o-y in CY'24

• Exports to India rise 15% y-o-y
  
  
• Import prices fall 12% y-o-y
  
  

South Africa's non-coking coal exports reached 6.42 million tonnes (mnt) in December 2024, a 2% increase from November. In CY'24, exports totalled 63.26 mnt, marking a 6% rise compared to 59.86 mnt in CY'23. This growth reflects sustained demand for South African coal despite global energy transition challenges.

Country-wise exports

In CY'24, exports to India rose by 15% to 30.19 mnt compared to 26.32 mnt in CY'23. Higher sponge iron production boosted demand for non-coking coal. Sponge iron production was recorded at 49.5 mnt in January-November 2024 against 44.8 mnt in the corresponding period of last year. Sponge iron producers prefer imported South African coal, whose specifications offer higher productivity and efficiency levels when pitted against high-ash domestic coal.

South Korea remained the second-largest importer, with a 5% y-o-y growth, importing 5.61 mnt. Meanwhile, Vietnam and Pakistan experienced significant increases, importing 5.24 mnt and 3.09 mnt, respectively, reflecting a substantial rise of 132% and 57% y-o-y.

Market overview

South African coal prices were more viable this year compared to last year. The average price of RB2 coal (5500 NAR) decreased 12% in this period to $105/t CNF Gangavaram ($119/t).

South African non-coking coal prices remained unchanged m-o-m in December, as market activity was limited due to cautious trading conditions. Ample stockpiles at both ports and with buyers created downward pressure on trade. Domestic supply was sufficient, with Coal India's dispatches rising slightly m-o-m.

In December, the price of sponge iron (pellet-based), ex-Raipur, decreased by 4%, falling to INR 24,650/t from INR 25,552/t in November. Sponge CDRI prices also dropped to INR 26,154/t from INR 26,916/t in the previous month.

Low demand in the semi-finished and finished steel markets kept sponge iron prices under pressure, with reduced procurement leading to price cuts and negative margins for suppliers.

Outlook

Increased allocations of domestic coal at auctions by CIL in different states and ample port stocks are likely to keep South African coal arrivals rangebound in January.