The ongoing downtrend in the global coking coal segment has exerted pressure on metallurgical coke prices and on pig iron prices in India. “Actually, workable prices [for met coke] are at least INR 1,000/mt (around $13/mt) lower than offers voiced by producers,” an Indian trader commented. Nevertheless, local met coke suppliers in India find it extremely difficult to decrease prices due to feedstock purchased at higher prices earlier. “I certainly agree that demand is muted due to the elevated price levels and the tumbling of coking coal prices, but to offer at INR 58,000-60,000/mt ($763-790/mt) ex-works means to sell below cost,” an Indian met coke producer said.
On balance, although current met coke prices in India have remained at around INR 62,000/mt ($816/mt) ex-works, it is not excluded they will decline in the coming week, a few sources believe. “Today, it is the beginning of a new financial year in India. Hence, the new met coke prices would be declared later. Although de-facto a price correction is already seen,” a trader commented.
Despite active discussions around ex-Russia coking coal sales to India and, moreover, a real increase in shipments according to statistics, it has been preferred to keep the information with regard to that business mostly confidential. “I haven't heard of any recent Russian deals, but they are everywhere in the news,” a Singapore-based trader stated. “All information with regard to Russia is highly sensitive nowadays. There are just a few offers from Russia. Accordingly, PCI and anthracite coal are available at $350-400/mt CFR,” a major international trader commented. As SteelOrbis reported earlier, the latest transaction, for 75,000 mt, of ex-Australia premium mid-volatility hard coking coal was fixed at the end of last week at $540/mt FOB, down $59/mt from the previous transaction.
The situation in the pig iron market in India has developed likewise. The recent developments in the coking coal market have encouraged customers to seek lower prices for basic pig iron (BPI). In particular, an offer for 2,000 mt from Indian state producer BSP at INR 59,000/mt ($779/mt) ex-works within the scope of a tender has failed to attract any buyer. Earlier, the local BPI prices were at around INR 62,000-63,000/mt ($816-829/mt) ex-works, while the latest export transactions have been fixed at $790-805/mt FOB. “There is not much activity. The market went down at the end of March. However, I do not exclude it will come up again,” an official at a major exporting Indian BPI mill stated.