Coal news and updates

Petcoke prices fall further on high supply, falling freight

Delivered prices of imported fuel grade petroleum coke fell another $4/mt on the week on persistent oversupply and weakening dry bulk freight rates, sources said.

Platts assessed the weekly 30-60 day prices of fuel-grade petroleum coke with 6.5% sulfur at $63.50/mt CFR India East, and $62.50/mt CFR India West, both down $4 from a week ago, following a similar drop last week.

"Coal is weak and petcoke has to follow coal," a south India-based trader said. "There is always a cascading effect on competing commodities."

He said many suppliers are looking at the Indian market as demand for petcoke has been strong.

Supramax cargoes of US Gulf Coast petcoke with 6.5% sulfur could be procured in the low-$60s/mt CFR India levels, he said.

This source said in the last 45 days he had sold about five cargoes of imported petcoke to Indian cement companies, including US and Saudi Arabian material, for September-November loading.

"In a span of around 45 days, the price of US petcoke with 6.5% sulfur has crashed down to $64/mt CFR from about $74/mt CFR levels," he said.

He sold a Supramax cargo of US petcoke with 6.5% sulfur at around $64/mt CFR west coast India, which is scheduled to be loaded next week, he said. He did not give details of the other deals.

But he said prices have come down further and going forward he expected prices to even breach the $60/mt CFR level.

A north India-based trader also said imported petcoke prices "are crashing" on weak freight rates and oversupply.

He pegged the Supramax freight rate from the US Gulf to India at around $26/mt, and said buyers are looking for petcoke at below $60/mt CFR India.

A west India-based trader said, offers for US petcoke with 6%-7% sulfur are in the mid-$60s/mt CFR but buying interest is at low-$60s/mt CFR India.

He said freight rates are weakening, pegging the Supramax freight rate from US Gulf to India at about $27/mt and FOB price of petcoke with 6%-7% sulfur at around $37-$38/mt.

Petcoke prices are tracking coal, he said, adding that he expects steep falls in petcoke prices in November as suppliers would seek to offload their allocations as year-end approaches.

The first south India-based trader said he has sold two 50,000 mt shipments of Saudi Arabian petcoke with more than 8.5% sulfur at $51-$52/mt CFR east coast.

He expects prices of Saudi petcoke to weaken as well in the near term.

The west India-based trader said prices of Saudi material would be close to around $50/mt CFR India levels this week.

A north India-based source said Indian buyers are looking at buying Saudi petcoke at high-$40s/mt CFR.

According to him, there is still a wide spread in prices between US and Saudi material, making the latter an attractive option.

source: http://www.platts.com