Chinese buyers have not been interested in coking coal imports this week due to unattractive prices compared to those seen locally. Besides, import activity has remained muted as traders have continued to evaluate the chances of doing business with Russian suppliers of coking coal despite the sanctions imposed on Russia following its invasion of Ukraine.
Accordingly, ex-Russia low-volatility pulverized coal injection (PCI) is available now in China at $275-280/mt CFR, having moved sideways from $260-300/mt CFR since last week. Meanwhile, ex-Russia premium hard coking coal with 10 percent ash content has been offered at $320/mt CFR, up around $20/mt over the past week. “Negotiations are actively going on with sellers, though payment issues are not yet clear,” a major international trader stated.
A 80,000 mt cargo of ex-US Kellerman mid-volatility premium hard coking coal (HCCA), for April 1-10 laycan has been offered at $575/mt CFR China, but with no bids at this level. “Prices are unacceptable to Chinese buyers apparently,” a Singapore-based trader commented. Tradable levels for ex-US premium low-volatility hard coking coal (HCCLV) have been assessed at $450-460/mt CFR, down at least by $5/mt over the past week.
Notwithstanding resistance to accepting current coking coal prices and the consequent lull in trading, coke prices in China have increased once again. The rising capacity utilization rates and bad transportation due to the worsening of the Covid-19 pandemic are among the main factors. However, with steelmakers’ production costs having risen significantly, any further rise in coke prices is unlikely. Specifically, the current coke prices in Tangshan are at RMB 3,460/mt ($545.5/mt) ex-warehouse, up by RMB 200/mt ($31.5/mt) compared to March 11, according to SteelOrbis’ data.
Ex-China export coke prices have risen by around $25/mt within the past two weeks, standing now at $620/mt CFR for blast furnace (BF) coke (CSR 62%) and at $625/mt CFR for BF coke (CSR 64/62%) at $625/mt FOB, respectively. “Europe is hungry for coke, having lost Russia recently as a key supplier,” a Chinese coke supplier stated.
In the meantime, in the futures market in China, as of Friday, March 18, coal prices at Dalian Commodity Exchange (DCE) have increased by RMB 13/mt ($2/mt) to RMB 3,051/mt ($480/mt). Meanwhile, coke futures prices have risen to RMB 3,691/mt ($582/mt), up RMB 13.5/mt ($2.1/mt) compared to March 11.
$1 = RMB 6.3425