Indian coking coal import price falls below $200/mt mark

Wednesday, 08 August 2012 15:15:20 (GMT+3)   |  
       

Prices of imported coking coal in India have fallen below the $200/mt mark this week, with ex-Australia offers now at $195/mt FOB at Chennai in southern India, traders said today, August 8.
 
Until just a week ago, hard coking coal from Australia was quoted at $205/mt FOB, but the landed price in India has slumped on reports of lower off-take in China, a Kolkata-based coal trader said.
 
"The sharp fall is very welcome since at any level below the $200/mt mark importers stand to gain at least 25 percent even after factoring in the disadvantage of the weakening rupee," a trader in Mumbai said.

"The market expects coking coal prices to remain soft at least until December on reports trickling in that several Chinese steel mills have been cutting back production," he added.
 
"The import price of coking coal will soften further in the coming quarters since production is up," a statement issued by Steel Authority of India (SAIL) said.

According to SAIL, the country's largest integrated steel producer, its coking coal imports will increase to levels of around 19 million mt in FY 2012-13 compared to 12 million mt in FY 2011-12.

As per estimates of the empowered joint committee of government-owned steel producers, India's total coking coal imports are expected to increase by at least 10 percent during FY 2012-13 to 36.8 million mt to meet a demand of 58.7 million mt.
 
"The softening of prices has prompted Indian importers to turn aggressive in striking deals. But the preference is still for Australian origin hard coking coal because of lower sulphur content," a trader said.
 
The trader said that India's state-owned Minerals and Metal Trading Corporation (MMTC) has sought quotes for import of 120,000 mt of coking coal to test the market before negotiating larger shipments. SAIL has floated a tender to import 50,000 mt after concluding 97,000 mt for May shipment and 37,000 mt for April shipment.


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