Though overall buying activity has been not so strong in the ex-Australia premium hard coking coal (PHCC) market this week, prices still have support and a number of market sources agree that the $250/mt FOB mark will be crossed very soon in deals. Negotiations with Indian buyers have been more active compared to last week, adding to the cautious optimism in the market.
Most offers for ex-Australia mid-volatile PHCC have hit $255/mt FOB, with sellers targeting sales to India. “There are offers at $270/mt CFR to India already, so we will see the deals breaking above $250/mt FOB very soon,” a trading source said. This price is above offers for the same grades at $245-250/mt FOB early this week. Indian mills have already started to be more active, discussing September shipment material purchases. Some sources said that a few direct sales from the miners to mills in India have already been done at $250/mt FOB late this week, but no further details have been found by the time of publication.
A deal for 100,000 mt of low-volatility Saraji PHCC was closed at $246.5/mt FOB early this week.
The tradable level for low-volatility PHCC in China has been assessed by the market participants at $250-255/mt CFR, slightly lower than $255/mt CFR seen last week. Chinese mills are still interested in negotiations for ex-Australia coal, but, as the local coking coal prices have retreated and since there are still attractive offers for ex-US material, they have been resisting paying higher prices.
The SteelOrbis reference price for ex-Australia PHCC has increased to $248/mt FOB, up by $2/mt from the previous level.