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“First-quarter benchmark met coal seaborne export prices are forecast to be $185 per tonne cfr China,” analyst Evan Kurtz said in a webcast on Thursday November 29 about coal dynamics, current trends and the outlook for 2013.
“There could be a possible rollover at $170 cfr,” he added.
“Steel mills in China have been aggressively focusing on destocking as they want to show clean balance sheets,” he explained.
“The latest reports are [that there are] 12 days of met coal inventory in China, which is very low. Chinese mills have also been driving down steel inventories and they’re now at a three-year low,” he added.
“In the first quarter of 2013,” he concluded, “there will be seasonal pick-up in steel demand, which will result in an improvement in met coal and iron ore demand and consumption levels.
Export prices for seaborne US metallurgical coal are forecast to hit $185 per tonne in the first quarter of 2013, supported by an expected rebound in Chinese steel demand, according to global financial services provider Morgan Stanley.