Prices for seaborne pulverized coal injection (PCI) increased in both the cfr China and fob Australia market in the week to October 15 due to supply tightness in both markets, market sources said on Friday.
Premium hard coking coal, cfr Jingtang
: $611.10 per tonne, up by $0.95 per tonne
Hard coking coal, cfr Jingtang
: $561.67 per tonne, down $0.86 per tonne
Premium hard coking coal, fob DBCT
: $399.61 per tonne, down $6.17 per tonne
Hard coking coal, fob DBCT
: $339.84 per tonne, down $7.50 per tonne
The seaborne coking coal market remained strong and stable on Friday.
Market participants referred to the latest deal price of $610 per tonne for United States-origin premium low-volatility (PLV) hard coking coal as the recent market benchmark price.
“If the market goes down later, mills may not accept this deal price, but if the market continues to go up, several mills have to accept the price of about $610,” a mill source from southern China said.
Other mills sources have turned to Russian coking coal, due to the lower price and high cost-efficacy, to blend with domestic coking coal cargoes, market sources said.
“The current prices for US-origin coal are higher compared with domestic coal. Most end users have turned to domestic cargoes, and only a few trading houses are looking for speculative buying,” a Beijing-based trader source said.
The fob Australia coking coal market decreased on Friday amid falling offer and bid prices.
Buyers reported bids for December-laycan PLV at $383 per tonne fob Australia, and miners’ offers also decreased on the Globalcoal trading platform from $410 to $401 per tonne fob Australia on Friday, market sources told Fastmarkets.
“People now are expecting lower prices than previous deals of $405 (for PLV) and are sending low bids to show their determination,” a mill source from India said.
No deals were reported in either the cfr China or the fob Australia coking coal market on Friday.
The seaborne PCI price in China in the week to October 15 increased sharply due to limited supply.
PCI supply in China was limited because major coal mines prioritized thermal coal production. Thus, they were able to implement long-term supply contracts with end users for the fourth quarter, market sources said.
“Major PCI and thermal coal are processed from the same raw coals. An increased PCI price could support its production when there is an attractive profit in thermal coal,” a trader source from Shanghai said.
30,000 tonnes of Russian low-vol PCI with September laycan was traded at $301 per tonne cfr China during the week, several market sources said.
Fastmarkets’ index for PCI, low-vol, cfr Jingtang
was $307.68 per dry metric tonne on October 15, up by $23.06 per tonne on a weekly basis.
The fob Australia PCI price jumped in the week to October 15 amid continuous supply tightness, market sources said.
A mill source from India said strong thermal coal prices also supported PCI prices in the Australian fob market this week.
Australian low-vol PCI was offered at about $300 per tonne fob Australia during the week, with buyers hesitant to procure, a Vietnam-based trader said.
Fastmarkets’ index for PCI, low-vol, fob DBCT
was $280.74 per dmt on October 15, up by $25.30 per tonne on a weekly basis.
Dalian Commodity Exchange
The most-traded January coking coal futures contract closed at 3,614 yuan ($561.25) per tonne on Friday October 15, up by 142.50 yuan per tonne day on day.
The most-traded January coke contract closed at 4,105.50 yuan per tonne on Friday October 15, up by 247.50 yuan per tonne day on day.