Asia met coal PLV FOB Australia prices continued to fall Nov. 16, as lower offers failed to entice buying interest in the global market.
An offer was heard at $280/mt FOB Australia for 35,000 mt of global COAL HCCA Branded, down from $285/mt Nov. 15, with a standard December laycan. Some market participants gave tradable levels between $270-$280.25/mt FOB Australia for Australian premium low-vol Saraji.
“I think end-users are offering down the market and any buyers with genuine demand will likely just allow this dynamic to take place,” said an international trader.
In China, there was growing consensus that the unofficial import ban on Australian coal may be lifted following positive messages out of the G20 meeting between China and Australia, according to sources. However, two major state-owned steel mills told S&P Global Commodity Insights that they have not received any verbal notice from customs as such.
“There have been talks about potential relaxation of the imports of Australian coal, but we have not received any firm inquiry from China yet,” added an Australian producer.
In the metallurgical coke market, participants were anticipating a price uptick due to poor margin and strengthening currency.
“A stronger Yuan recently was making export business of coke less profitable, hence we had to increase our offer levels a bit to offset the currency impact,” said a Chinese coke exporter.
In the domestic Chinese coking coal segment, prices improved slightly with Shanxi’s Liulin low-sulfur coking coal prices rebounding after last week’s drop. A Chinese trader said that the domestic market sentiment has recovered since the beginning of this week, with more inquiries being received for both domestic low sulfur and low ash cargoes as well as for port stocks.
However, pressure remained in the domestic pulverized coal injection coal and other non-premium coal markets, in view of a fast-falling thermal coal market, and increased imports of
Mongolian coal through the Ganqimaodu border.
“With the trucking capacity rebounding to over 800 trucks a day now we are seeing ample supply in the generic hard coking coal segment,” a Chinese trader said, adding that a still negative steel profit margin could also keep prices under pressure in the near term.
Platts assessed the domestic Shanxi PLV up by Yuan 55/mt at Yuan 2,565/mt ex-washplant on week Nov. 16, while CFR China equivalent of Shanxi PLV was at $302.11/mt, up $14.15/mt from the week before. The domestic-seaborne price spread stood at $4.11/ mt Nov. 16, with the domestic material being more expensive. Platts is part of S&P Global Commodity Insights.
Disclaimer: this article is from the SBB STEEL MARKET DAILY, the copyright belongs to the original author, and only represents the original author's viewpoint.
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