While the consequences stemming from Russia's invasion of Ukraine continues to unfold and the outlook is extraordinarily uncertain, European steelmakers have remained concerned about coke supply. Struggling to find alternatives to Russia suppliers, European customers have been forced to accept much higher prices in order to secure feedstock.
In particular, SteelOrbis has learned of active trading of ex-China metallurgical coke (65% CSR) at $580/mt FOB to Europe, which is $80/mt higher than the pre-war levels. “There is nothing to focus on in China now except coke. Nothing can be imported with such exorbitant global prices,” said a Chinese trader who has been forced to refocus from imports to exports in his trading following the recent developments in the global market. “The European market is fueled by shortage now, being out of control. We have to react to a completely unexpected turn of events,” a major European trader stated. “The market is getting so crazy now. But there are already certain concerns about production cuts within these high market prices,” a Singapore-based trader said, echoing the general sentiments in the market.
Meanwhile, ex-Colombia met coke (65% CSR) prices have surged to $650/mt FOB Barranquilla. Given the previous freight rate at $45/mt, the CFR price appears to be at least $695/mt CFR, though some market insiders report that the freight rates have doubled so far on back of the surge in crude oil prices. “Everyone is ready to buy all that is available, but sellers are not in a rush, expecting prices to move up further,” one European trader stated.