Coal news and updates

Cheaper Saudi petroleum coke lures Indian buyers over US material

Deals for imported fuel grade petroleum coke were few and far between as buyers continued to scout for cheaper options, sources said this week.

Sources said that, as availability of high-sulfur Saudi petcoke has improved, Indian market is inundated with offers, giving stiff competition to US material.

Most buyers are covered through September and the cement industry is not yet out of the woods with most plants running at below capacities, a west India-based trader said.

Price expectations of Indian buyers are very low as they expect to buy US Gulf Coast petcoke at around $75-$76/mt CFR irrespective of the vessel size and port location, this source said.

According to him, FOB prices have come down only by about $0.50-$1 and Supramax freight rates from US Gulf to India are still hovering at about $33/mt.

He said that the "doable" price for a Supramax cargo of US petcoke shipment with 6.5% sulfur would be at about $80/mt CFR west coast India.

Another west India-based source said that Indian buyers are bidding at sub-$77/mt CFR levels for US Gulf petcoke.

Currently, he is focusing on Saudi Arabia material, he said, adding that situation might improve next month when monsoon season gets over and cement demand picks up.

However, a south India-based source said that it is possible to close deals below $80/mt CFR levels for US petcoke with 6%-7% sulfur as FOB prices are under pressure due to higher freight rates.

He said that he had closed a deal recently but declined to provide details about it.

A north India-based trading source said offers for US cargoes are in the range of $80-$81/mt CFR on Supramax vessels.

SAUDI PETCOKE

A west India-based end-user source said that he had bought a Supramax shipment of Saudi petcoke around three weeks back at around $63/mt CFR west coast India, and the cargo is already on the high seas.

A south India-based end-user source said that he had received an unsolicited offer for a Supramax cargo of Saudi petcoke with over 8% sulfur at $59.50/mt CFR east coast India.

The north India-based trader agreed that Saudi petcoke is being offered below $60/mt CFR levels and this material is gaining popularity due to the wide price spread between Saudi and the US material.

The second west India-based trader also said that it was possible to get Saudi material at about $60/mt CFR if there were firm bids.

Platts assessed the weekly 30-60 day prices of fuel-grade petroleum coke with 6.5% sulfur at $78.75/mt CFR India East and $77.75/mt CFR India West, both down 50 cents from a week ago.

source: http://www.platts.com