Prices for ex-Australia premium hard coking coal (PHCC) have fallen by $20/mt since last week, as confirmed by the latest few deals done below $240/mt FOB and bids already heard at $230/mt FOB and below. Ample supply, the easing of concerns over supply in the August-September period despite the accident at Anglo American, and the weak conditions in the finished steel markets in India, China and other Asian countries have been behind the recent trend.
A deal for 40,000 mt of mid-volatile PHCC for end-of-August laycan was done at $235/mt FOB on Monday, while another contract for 75,000 mt of Goonyella PHCC was signed at $238/mt FOB for mid-August laycan a day later. This is down from the $250/mt FOB reference price late last week and the peak deal price of $260/mt FOB in early July.
However, on Wednesday, a further decline in bids and offers has been reported by market sources amid sustainable supply for August shipment. An offer for 40,000 mt of Goonyella PHCC was at $232/mt FOB for early August shipment. A few firm bids have come at $230/mt FOB and $225/mt FOB and, “I expect new deals at this level will be done soon as a lot of cargoes are in the market,” a trader said.
The SteelOrbis reference price for ex-Australia coking coal has settled at $230/mt FOB today, down by $5/mt from yesterday and down $20/mt over the past week.
Some Indian mills have been waiting for $240-245/mt CFR, which translates to $220-225/mt FOB.
The Chinese market has been silent with only a few offers for the North American market at $245/mt CFR. Ex-Russia PCI offers have been at $145/mt CFR and above, down from a $151/mt CFR deal last week, but buyers have wanted $140-141/mt CFR.