Seaborne metallurgical coal PLV FOB prices continued to rise on tight supply of premium hard coking coals Jan. 24.S&P Global Platts assessed Premium Low Vol up 50 cents/mt at $444.50/mt FOB Australia, and CFR China up 50 cents/mt at $406/mt CFR China Jan 24. The spot market saw a slow start to the week with both buy- and sell-side participants staying on the sidelines to assess market sentiment, following a strong uptick in prices. "The market probably needs time to digest the trade, and this a high price may put [off] more end-users who might look into stretching their inventory further," an international trader said. Several market participants said that despite the rising prices of premium coking coals, end-users who had urgent restocking demand would still have to secure spot tonnages, but "they preferred to conclude trades on floating price basis, if they had any downside risk concerns," another trader said. On the supply side, availability of Australian spot cargoes remained tight due to COVID-19 related issues, market sources said. Major producers in Australia such as South32 flagged that the restrictive measures to contain the pandemic could further impact labor and productions. "The implementation of additional COVID-19 workforce restrictions in New South Wales has the potential to further impact labour availability across the June 2022 half year," the company said in its quarterly report Jan. 24. South32's metallurgical coal production was 1.19 million mt in the quarter of October-December, down 15% on year and 24% on quarter. South32 said that lower production volumes came as it completed an extended longwall move at Illawarra metallurgical coal. In China, trading activity remained thin as buyers retreated to the sidelines ahead of Lunar New Year holidays. "The domestic coking coal market is rather stable, but COVID-19 cases and potential winter storms remain as two wild cards affecting the domestic coking coal market," a trader based in China said.
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