COKING COAL DAILY: Seaborne cfr prices strong despite divergent outlooks

Coking coal prices in the seaborne cfr market were strong on Friday September 24, with views split among market participants over the direction of prices during the upcoming winter season.

Fastmarkets indices
Premium hard coking coal, cfr Jingtang: $600.82 per tonne, up $1.51 per tonne
Hard coking coal, cfr Jingtang: $575.23 per tonne, up $25.23 per tonne
Premium hard coking coal, fob DBCT: $405.99 per tonne, down $5.08 per tonne
Hard coking coal, fob DBCT: $334.84 per tonne, down $2.50 per tonne
Fastmarkets Weekly PCI indices
PCI low-vol, cfr Jingtang: $273.27 per tonne, up by $0.12 per tonne
PCI low-vol, fob DBCT: $252.92 per tonne, up by $10.12 per tonne
In the cfr market, seaborne hard coking coal prices increased by more than $20 per tonne on Friday after a trade was heard done at higher levels.
A cargo of United States-origin second-tier hard coking coal Buchanan was traded late last week at around $560 per tonne cfr China, Fastmarkets heard on Friday.
“Prices will drop in winter when there is stringent production controls surrounding Beijing,” a trading source said.
Despite a pessimistic outlook held by many market participants, the seaborne premium hard coking coal price stood at $600.82 per tonne cfr China, up $1.51 per tonne day on day. Several trading sources said tight supply of seaborne material as well as uncertainty over domestic supply will help support the current price level.
“When it’s near the Spring Festival season, coal mines will emphasize safety and may lower their output. So domestic coking coal supply may get tight,” a trading source in Hebei province told Fastmarkets.
The low-volatility pulverized coal injection (low-vol PCI) cfr price remained flat during the week to Friday. Russian low-vol PCI supply in the spot market was tight, but Chinese domestic PCI prices edged lower this week.
Late this week, Russia’s Mechel held a tender for the sale of their K10 coking coal and PCI material. The results had not been heard at the time of writing.
Meanwhile on Friday, three mine workers died of suffocation in a coal mine operated by Huineng Coal Group Balongtu Coal Co. The mine is located in Inner Mongolia Autonomous Region in China.
After eleven rounds of coke price increases since the start of August, Chinese domestic coke prices were relatively stable in the week to September 24.
In the fob market, a November-laycan Panamax vessel of premium hard coking coal was offered at $407 per tonne fob Australia on the Globalcoal platform on Friday, sources said.
Two consecutive days of a relatively quiet trading made some market participants lower their estimates for both premium hard coking coal and hard coking coal.
“The fob market is relatively stable now,” a trading source in India said, while another trading source in Singapore said that prices may have peaked, “but it’s hard to predict.”
Dalian Commodity Exchange
The most-traded January coking coal futures contract closed at 2,800 yuan ($433.31) per tonne on Friday, down by 202 yuan per tonne.
The most-traded January coke contract closed at 3,197.50 yuan per tonne, down by 219.50 yuan per tonne.

Min Li

min.li@fastmarkets.com

Published

Min Li

September 24, 2021

11:54 GMT

Shanghai