Prices for ex-Australia premium hard coking coal (PHCC) have retreated in the latest deals after the previous strong increase. Most sources believe that the main factor behind this has been ample supply, while demand has been moderate and signals from China have started to be negative again.
One of the major Japanese mills has concluded a deal for 30,000 mt of low-sulfur higher grade premium hard coking coal SRC from Australia for mid-June laycan at $243.5/mt FOB today, the deal has been made in combination with 50,000 mt of premium low-volatile coking coal with an index-based price. Previously, there were deals done for premium coking coal at $245/mt FOB and $246/mt FOB.
The SteelOrbis daily reference price for ex-Australia PHCC has been lowered to $240/mt FOB, down by $6/mt.
May hard coking coal futures at Singapore Exchange have declined $6.5/mt or 2.64 percent from yesterday, to $239.5/mt FOB.
“Supply is increasing and this makes the major pressure I believe. China will not buy for a good period of time, today futures have fallen again,” a trader commented. The tradable level for premium coking coal in the import market in China has fallen to $220-225/mt CFR, down by $30/mt from the previous levels. Some mills have been assessing to bid at even lower level - $200-210/mt CFR. As a result, ex-Australia premium hard coking coal trading in China has been almost halted and buyers have preferred cheaper ex-Russia materials.
In particular, ex-Russia premium hard coking coal K10 has been traded at $159-160/mt CFR recently for end-May shipment, while offers for premium materials from Russia were at least $50/mt higher in late April. The latest offers for Inagli coking coal from Russia have been at $150-155/mt CFR versus late April deals at $198-200/mt CFR. Deni Deep offers have fallen to $160-165/mt CFR.