Posted on 10 Apr 2023
Australian fob coking coal prices continued to fall last week on more supply availability.
Kallanish assessed premium hard coking coal at $278.33/tonne fob Australia, falling $17.32/t from $295.65/t the previous week.
On the Singapore Exchange, Premium Coking Coal Futures for May settled at $285/t on Thursday. This is versus the April settlement price of $302.33/t fob a week earlier.
According to a trader, BHP sold 25,000 tonnes of Goonyella/ Goonyella C/ Riverside for 15-24 May laycan at $290/$287/$287 fob on 5 April. This was not an independent deal, and the balance was likely done index-linked or coloaded with other material, the trader believes.
Meanwhile, a Chinese steel mill bought 80,000t of Peak Downs / Saraji for 1-10 May laycan at $307/t cfr China from a trader on 4 April.
Citing globalCOAL, a trader reveals that the asking price for 35,000t of hard coking coal for May laycan was at $298.00/t fob on 6 April.
“The market is weak because of better supplies,” says a trader. He does not think the recent correction will spur Chinese coking coal imports from Australia as demand is mostly driven by steel demand and steel prices, which are not supportive now.
“The market seems to be unwinding their physical position – China is emphasising self-reliance and this may mean further ramp-up of domestic production, hence depressing sentiment further,” says another trader. He foresees coking coal prices remaining weak in the next two weeks due to more availability.
“I think the poor coking coal sentiment was due to weak coke and steel markets,” says another trader. He also notes that China's coking coal demand is weak as buyers there need more time to boost consumption.
Another trader also highlights that BHP coking coal production is very strong now, which has led to lower coking coal prices. “Coking coal demand is stable. However, the downtrend is likely to continue because of better supply,” he adds.
"I think most steel mills are not buying coking coal now. The market is looking for cheap coal," says a Malaysian steel mill source. He also notes the selling price for lower quality med-vol coking coal from East Malaysia is now at $210/t fob.
Source:Kallanish
