Coal news and updates

Indian met coke traders avoid deals in imported material

March 25: Traders dealing in imported metallurgical (met) coke are avoiding entering into fresh deals following the recent steep decline in prices even as domestic met coke prices continue to remain stable, industry sources said.

"The situation is quite erratic so far as imported met coke is concerned as prices have fallen drastically in the last few days and because of this very few traders are interested in book new cargoes," an official with a coke trader said.

"And because of the steep decline, consumers too are bidding for much lower rates in anticipation that prices will fall," he said.

However, traders who booked cargo at around $235-240 per ton CFR India are now finding it difficult to sell their material because there are no buyers.

"Steel-makers want us to sell the cargo at $215-220 per ton CFR Paradip, which means significant losses. Because of this, new deals in imported met coke are not taking place. On the other hand, whoever had bought the cargo at $235-$240 per ton are now being forced to sell at about $215-$220 per ton," said a second trader.

Recently, a trader-cum-manufacturer had told ICMW that he was willing to sell a full vessel of 40,000 tons of met coke at $215 per ton CFR Paradip, while a pig iron-maker said that he procured a small quantity of imported met coke at $215 per ton CFR Haldia.

"There are expectations in the market that met coke prices would touch $200 per ton and till a clear picture emerges, coke traders are avoiding deals for fresh cargoes of imported coke," he said.

So far as domestic met coke prices are concerned, a third trader said, though coking coal prices have fallen drastically during the past one month, their impact on coke prices would be felt only gradually.

"Even now, the coking coal cargo booked in February at about $125 per ton FOB is arriving. At that point in time, the price of imported met coke was around $257 per ton. Meanwhile, met coke prices have fallen to $215-220 per ton whereas coking coal is being traded at about $108 per ton as of March 24, but steel-makers are looking to buy domestic met coke at a discount of about Rs 2,000 per ton over the prices prevailing in the first week of March because of a decline in imported met coke prices. But that is not possible or feasible" the trader said.

"Prices of domestic met coke will definitely fall in view of a decrease in prices of the imported material and softness in coking coal prices, but it will take some time," the trader added.

He pointed out that because of the prevailing situation, domestic met coke-makers too are facing problems and carrying slightly higher inventories, because they are unable to sell their material as they are not in a position to match the imported price, which steel- makers are insisting upon.

A domestic met coke-maker had offered to sell around 5,000 tons of hard coke at a price of around Rs 15,000 per ton, which is equivalent to $245 per ton in the first week of March, but it did not find a single buyer.