Asian seaborne hard coking coal spot market quiet amid weak outlook

Weak demand, slack steel prices and competition from domestic material continued to damp buying interest for seaborne hard coking coal in Asia on Wednesday May 21.

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Steel First’s cfr Jingtang premium hard coking coal index was calculated at $124.00 per tonne on Wednesday, down by $0.08 from Tuesday’s level.

The cfr Jingtang hard coking coal index also edged down by $0.16 to stand at $113.63 per tonne.

The fob Australia premium hard coking coal index went up by $0.79 on the day to $116.37 per tonne, while the hard coking coal number went down by $1.05 to $102.91 per tonne.

“I haven’t heard much trading activity recently. Price-wise, it’s not going up but it’s not going down much either, due to limited immediate supply,” a trading source told Steel First.

Market participants speaking to Steel First considered top Australian brands tradable at $124-126 per tonne cfr China and second-tier hard coking coals at $112-114 per tonne cfr.

Separately, rating agency Moody’s lowered its outlook for China’s property industry to negative from stable on Wednesday, pointing to an expected slowdown in residential property sales growth, high inventory levels and weakening liquidity over the next 12 months.

Elsewhere in Asia, Japan does not seem to have much appetite for spot cargoes either, with quarterly benchmark negotiations imminent. This is because the mills do not want to give any price indications to the market, a trading source said.

There is potential for the third-quarter benchmark to be lower than that of the second quarter, which was concluded at $120 per tonne fob Australia, he added.

The most-traded September coking coal futures contract on the Dalian Commodity Exchange closed at 805 yuan ($130) per tonne on Wednesday, down from Tuesday’s close of 814 yuan ($132) per tonne.

The most-traded September coke contract also closed lower at 1,137 yuan ($184) per tonne, compared with the previous close of 1,143 yuan ($185) 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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