NEWS
Coal  

China's domestic, import coking coal prices in tandem

Seaborne premium hard coking coal prices have increasingly fallen into a pattern of moving with domestic prices in China, as the country solidifies its position as the expected destination for available spot cargoes through to the end of the year.

As November-loading premium cargoes emerged from Australian producers for delivery near the end of the year, buying interest from Chinese mills lifted premium low-volatile cfr China prices as high as $167/t from $155.25/t on 1 October. But this increase was short-lived, driven mainly by momentarily relaxed import controls at northeast Chinese ports because of leftover import quotas nearing the end of the calendar year. Restrictions in northeast China were said to be one of the strictest for most of the year.

Prices reversed again just less than two weeks after the end of the national day week-long holidays at the start of October, as a cargo of Saraji traded at $164-165/t cfr compared with a similar cargo traded at $167/t cfr just a week ago.

Spot prices of Australian coking coal into China have been consistently below $170/t cfr China since mid-August as the lack of returning Indian demand after the June-September monsoon season resulted in a surplus of premium mid-volatile cargoes in the spot market.

Muted spot demand from across Europe, India and southeast Asia promoted China to the role of clearing house for any surplus volumes in the seaborne market. Not only has the fob Australia/cfr China spread reverted to roughly a freight netback, but cfr China price changes have recently mirrored the dips in the domestic market as Chinese steel mills maintain a value comparison between the two markets.

Domestic premium low-volatile coking coal prices were assessed by Argus at $225.27/t on an ex-mine basis on 1 October, but have since dropped to $203.47/t as Chinese mines saw production and coal transportation facilities improve and stabilising supplies. This 10pc drop preceded a drop in premium import prices to $162.90/t cfr China yesterday from $167/t at the end of last week as deals were done at consecutively lower levels for the same brands.

These buyers have shown a lack of willingness to pay beyond a roughly $40/t spread between premium low-volatile imports and similar domestic grades because of the risks and administrative troubles involved in getting coal imports past China's increasingly hawkish customs officials.

Chinese buyers and trading firms are deriving similar calculations when choosing to take seaborne cargoes on a fob Australia basis. Argus last assessed premium low-volatile at $149/t fob Australia, which nearly reflects a freight netback from yesterday's cfr China price of $162.90/t at current Panamax freight rates from Hay Point, Queensland to Qingdao, China of $13.80/t.

News No: 6944
Date: 2019/10/25 - 13:53
News Source: Argus Media

China  import  coal  price  Australia 

Comments:

Leave a Comment:

   
   
   
 

Producer price index improves in a quarter

Iran’s Producer Price Index (PPI) data for the Q4 of the previous Iranian calendar year (ended on March 19) indicates that the index has improved 10.6 percent compared to the Q3, IRIB reported on Wednesday.
 

Indian polymers demand recovers, imports remain weak

Demand for polymers in India has seen a slight recovery, a week after the easing of restrictions on industrial operations to curb the Covid-19 pandemic.
 

China's Chambroad Petchem to invest in new PP units

China's Chambroad Petrochemical is planning to build two 600,000 t/yr polypropylene (PP) units as part of a 5.17bn yuan ($728mn) propylene plant with 2.04mn t/yr of raw material processing capacity.
 

Viewpoint: US coking coal mines make cautious return

The resumption of halted operations at coking coal mines in the US comes amid signs of potential improvements in demand. But buyers and producers are still uniformly cautious about recovery for the rest of 2020.
 

Government funding boosts Thai bitumen demand

Thailand's road construction activity has picked up after the government released funding and the country lifted a nationwide Covid-19 lockdown earlier this month.
 

Vietnamese mills import less ferrous scrap in April

Vietnam's April ferrous scrap imports fell by 38.2pc to 401,055t from a year earlier, slowed by Covid-19-related restrictions.
Upcoming Events
Publications
 Mines & Metals

Mine & Business Today

 Scrap & Recycling

Ahangan

Our partners