Firmer buying interest for material with prompt lead times coupled with higher bids voiced by customers have continued to further fuel the Australian coking coal market. Accordingly, lately a 75,000 mt cargo of ex-Australia premium low-volatility hard coking coal (HCCLV), Saraji brand, for September 21-October 10 laycan has been traded at $250/mt FOB Australia, with the seller's option to replace the material with Peak Downs brand at $251/mt FOB Australia. The price is $5/mt higher compared to the highest bid voiced one day before the deal was done. Another cargo of 75,000 mt of ex-Australia premium mid-volatility hard coking coal, Goonyella Riverside, with September 16-25 laycan has been booked at $265/mt FOB Australia, with the seller's option to ship the same volume of Caval Ridge brand instead of the abovementioned at $262/mt FOB Australia. This is $12-15/mt higher than customers were ready to pay a day earlier. The outlook towards future developments has remained mixed, with some market players assuming that prices still have room for a further increase, while a few traders are convinced that such a fast rise in prices is evidence of speculation. “The traders must have cargoes in hand to sell it later at higher prices, so they are buying, aiming to push up the index. But demand from steelmakers remains discreet, driven by urgent needs,” an Asian source stated.
Nevertheless, futures prices in the latest trades at Singapore Exchange (SGX) have sharply increased. As of August 18, ex-Australia coking coal prices for August contracts rose by $1.67/mt to $245/mt, while for September contract prices increased by $25.67/mt compared to the previous levels to $275/mt.