Asian seaborne hard coking coal market quiet as price standoff continues

The Asian seaborne hard coking coal spot market was quiet on Monday May 12 as neither buyers nor sellers were willing to give way on prices.

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Steel First’s premium hard coking coal index for material sold on a cfr Jingtang basis was calculated at $124.68 per tonne, up by $0.72 from Friday’s level.

The cfr Jingtang hard coking coal index also went up by $0.27 to stand at $114.77 per tonne.

The premium hard coking coal index for material sold on an fob DBCT basis was down by $0.10 to $116.37 per tonne. The hard coking coal number stood at $103.26, also down by $0.71 per tonne.

Sentiment in China was weak, however, as the price of steel billet in Tangshan dropped by 40 yuan ($6) per tonne over the weekend to 2,850 yuan ($463) per tonne ex-works including VAT, and two major steelmakers made prices cuts.

Shagang lowered its list prices for long steel products by 50-60 yuan ($8-10) per tonne for mid-May, while Baosteel cut those for its June delivery flat steel products by 50-100 yuan ($8-16) per tonne.

“The market is still not clear at the moment. I hope it gets better but it’s hard to be better. Domestic coal prices would still be one of the factors affecting seaborne prices,” a trading source told Steel First.

Kailuan Group has raised its coking coal prices by 10-20 yuan ($2-3) for sales in the Tangshan region, but Shanxi Coking Coal kept its May prices unchanged from those in April. Sources said that an increase of 10-20 yuan ($2-3) per tonne would not have much effect on the market.

Seaborne offers remain limited as miners were unwilling to sell at lower prices. Buyers were also not actively buying.

A total of 10.18 million tonnes of coking coal was reportedly sitting at Chinese main ports on Monday, down from 10.66 million tonnes a week ago. Jingtang port alone saw its inventory drop to 4.05 million tonnes, compared with 4.46 million tonnes recorded last Monday.

The most-traded September coking coal futures contract on the Dalian Commodity Exchange closed at 863 yuan ($140) per tonne, up from Friday’s close of 836 yuan ($136) per tonne.

The most-traded September coke contract also closed higher at 1,211 yuan ($197) per tonne, compared with the previous close of 1,183 yuan ($192) per tonne.

The yuan prices are the equivalent of cfr prices plus 17% VAT and port charges of about 35 yuan ($6) per tonne.

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