Coal news and updates

Spread between petcoke, coal narrows, but still discounted to India

The spread between petcoke and coal delivered to India narrowed this week, but still offered a discount that should spark more demand for petcoke, traders said.

Indian cement producers have fueled much of the demand, which typically increases for petcoke when the price falls below 80% of the FOB and freight price of either South African or Australian coal.

"Usually when it gets less than a 20% discount, consumers don't like petcoke instead of coal," a USGC trader said.

On Wednesday, CFR India petcoke prices were 72.7% and 78.5% of Richards Bay and Newcastle FOB thermal coal plus freight to India prices, respectively.

S&P Global Platts assessed thermal coal FOB Richards Bay 6,000 kcal/kg NAR at $52.85/mt on Wednesday, up 75 cents week on week, and assessed FOB Newcastle 5,500 kcal/kg NAR at $43.20/mt, down $1.30 week on week.

Coal freight rates from Richards Bay to East Coast India (75,000 mt basis) were $7.10/mt, down 5 cents week on week, and rates from Australia to India were $7.70/mt, also down 5 cents.

Delivered petcoke prices to East Coast India were $54.50/mt, up $2.50 week on week.

The spread has narrowed since March, when high sulfur petcoke could be bought at 53.7% of South African coal and 61.3% of Australian coal.

source;Platts