COKING COAL DAILY: Prices in the cfr China market continue to rise on tight domestic supply

Seaborne coking coal prices trended higher in the cfr China market following a strong domestic coking coal market and fell slightly in the fob market on Friday August 13 with market participants adopting a wait-and-see attitude.

Prices for seaborne pulverized coal injection (PCI) increased in the cfr China market in the week to August 13 based on good restocking demand from end users and rose slightly in the fob market against low trading activities, sources told Fastmarkets.

Fastmarkets indices
Premium hard coking coal, cfr Jingtang: $345 per tonne, up $4.81 per tonne
Hard coking coal, cfr Jingtang: $299.50 per tonne, up $5.2 per tonne
Premium hard coking coal, fob DBCT: $222.17 per tonne, down $0.20 per tonne
Hard coking coal, fob DBCT: $195.91 per tonne, down $0.25 per tonne

The fob Australia coking coal market held steady on Friday after new deals in the week.

The fob Australia market gradually stabilized after the new transaction price of $220.50-222.50 per tonne fob Australia for premium low-volatility (PLV) hard coking coal was heard early in the week, while the Chinese market showed a strong upward trend, a mill source from South Korea said.

In China, offers for seaborne coking coal from North America remained strong due to increasing domestic coking coal and coke prices.

Most coke producers proposed to increase the coke price by 120 yuan ($18.52) per tonne on August 12, which is the third price increase proposal they have made in August. Market sources expect major steel mills to accept the price increase soon due to necessary procurement demand, based on their current low stock level.

Offers for PLV from North America were about $355-360 per tonne cfr China on Friday and for second-tier hard coking coal (HCC) offers were about $315 per tonne cfr China, sources said. No firm bids or deals were reported on Friday.

Overall demand for seaborne coking coal is limited but the supply of high-quality coking coal from both North America and China is tight, which could continue to support transaction prices in the short term, a Beijing-based trader source said.

A few traders are looking to Russian coking coal, which has a lower price and quality (due to low CSR), rather than cargoes from North America.

Russia-origin K10 (semi-hard coking coal) was offered at about $246 per tonne cfr China in the week, sources said.

PCI
The seaborne PCI price in China in the week to August 13 also increased amid necessary procurement demand and tight supply.

Fastmarkets’ calculation of the index for PCI, low-vol, cfr Jingtang was $188.76 per dry metric tonne on August 13, up by $4.42 per tonne on a weekly basis.

A Beijing-based seller source noted that there is more buying interest for cargoes loaded in late August and early September from Russia due to rising domestic PCI prices in China.

A cargo of Russia-origin low-volatility PCI was traded at about $185 per tonne cfr China during the week, sources said.

Offers for high-quality Russian PCI were about $190 per tonne cfr China in the week to August 13, yet cargoes with firm laycan were limited.

The fob Australia PCI price stayed largely stable in the week to August 13 because both demand and supply for Australia PCI remained weak, sources said. Only end-users with necessary restocking demand were procuring material and others held back due to high prices, sources added.

Fastmarkets’ calculation of the index for PCI, low-vol, fob DBCT, was $157.14 per dmt on August 13, up by $0.40 per tonne on a weekly basis.

Dalian Commodity Exchange
The most-traded January coking coal futures contract closed at 2,184.50 yuan ($337.16) per tonne on August 13, down by 21 yuan per tonne day on day.

The most-traded September coke contract closed at 2,885 yuan per tonne on August 13, up by 16 yuan per tonne day on day.