Atlantic coking coal: Prices dip, supply concerns hold
US export coking coal prices edged down in the past week under pressure from falling steel and iron ore prices, but persisting supply concerns and approaching seasonal weather-related risks continue to lend support.
The Argus weekly fob Hampton Roads assessment for low-volatile coking coal is at $204/t today, down by $2/t week on week. The weekly fob Hampton Roads assessment for high-volatile type-A (HVA) coking coal is at $213.50/t, while the high-volatile type B (HVB) index is at $171.50/t, both down by $2.50/t.
Trading activity has been fairly muted in the past week, with US market participants absent for several days for the Thanksgiving holiday, while well-covered European buyers have been in no rush to buy while steel and iron ore prices drop.
That said, the coking coal market has so far shown little reaction to those declines, with persisting global coking coal supply concerns supporting price expectations. Vessel queues at Queensland's Dalrymple Bay Coal Terminal (DBCT) hit 49 yesterday, and queues are also growing at other Queensland coal ports.
The Argus daily fob Australia assessment for premium hard low-volatile coking coal is at $222.50/t today, down on the week by just $1.85/t, while US high-vol price movements have also been minimal. "High-vol supply is just so tight right now, it can't reasonably move much," a sell-side market participant said.
The paper market has reacted more sharply to steep declines in steel and iron ore prices than the physical coking coal market. "A lot of people with long positions are looking to readjust," a European market participant said, pointing to an uptick in activity for the first quarter, and a $17/t drop in the December contract in the past two weeks.
Seasonality is also playing a part, with winter weather setting in and the potential for cyclone-related Australian supply disruptions in early-2019. "If steel and iron ore were coming off like this at a different time of the year, coking coal might react a bit more. But as it is, people are confident about supply concerns keeping prices quite pretty firm," the European market participant added.
US suppliers note varying levels of availability remaining for the first quarter of 2019, with some largely sold out and several buyers likewise already fairly well covered for the period. But some business is still being done. A southern European steelmaker was seen showing interest in some HVA material for the first quarter, from a supplier looking to place around 25,000-30,000/t month to either southern Europe or South America from the mine in question.
Elsewhere, some 10,000t clips of HVB are still changing hands fairly regularly, sources said. And while US steelmakers are for the most part covered for 2019, some domestic tonnage is still being allocated and priced for next year, market participants confirmed.
Coking coal stocks at Amsterdam-Rotterdam-Antwerp (ARA) remain high. Total coal stocks at Rotterdam's EMO terminal have risen to 4mn t from 3.8mn t a week ago. Port authorities indicate that around 15pc of this – or 0.6mn t – is typically coking coal.
Coal stocks at Amsterdam's OBA terminal – all of which is thermal – are flat on a week ago at 2.25mn t. Coal stocks at Ovet total 645,000t, up from 505,000t a week ago – of which around 70pc or 451,500t is estimated to be coking coal based on typical ratios.
Rotterdam's EBS terminal has 250,000t stockpiled, of which around 15pc – or 44,000t – is typically coking coal, according to port authorities.
Rhine water levels at the key measuring point of Kaub remain so low as to disrupt barging, measured at just 29cm at 1pm local time today.
Related news posts
Australia’s Pilbara Mining sees continuing Li demand
Australia’s Pilbara Mining sees continuing Li demand
Singapore, 19 April (Argus) — Australian mining firm Pilbara Minerals' sees continuing lithium demand from its customers, while the firm continues to focus on cost optimisation. Pilbara in March accepted a pre-auction offer of $1,106/dry metric tonne (dmt) for 5,000dmt of 5.5pc-grade lithium concentrate (spodumene) cif China. The price equates to approximately $1,200/dmt 6pc-grade lithium concentrate (spodumene) cif China, said Pilbara, which reflects the "ongoing demand and positive pricing for unallocated production volume". "When you look at the past 60 days up to mid-April, the increases [in lithium prices] are fairly material," said the firm's managing director and chief executive Dale Henderson during the latest quarterly earnings call, adding that the recent uptick in lithium pricing is "comforting". Argus -assessed prices for 6pc-grade lithium concentrate (spodumene) held stable at $1,100-1,200/t cif China on 16 April from a week earlier, rebounding from an all-time low of $850-1,050/t on 27 February. But a standoff has more recently formed between spodumene producers and lithium refineries, with the former maintaining their offer prices and consumers rejecting them. Pilbara's spodumene realised price in January-March fell by 28pc on the quarter to $804/dry metric tonnes (dmt) cif China, despite the average grade of spodumene shipments rising by 0.1 percentage point to 5.3pc, which translates to $927/dmt for 6pc-grade lithium concentrate (spodumene). But the realised price during the quarter remained above its unit operating cost of $519/dmt cif China, which fell by 1pc on the quarter. Pilbara's ending cash balance came in at A$1.8bn ($1.15bn) as at 31 March, down from A$2.1bn a quarter earlier. Output Pilbara's output during January-March rose by 2pc on the quarter and by 21pc on the year to 179,000dmt. The output was propped up by a record monthly production of over 80,000dmt in March, partly because the P680 primary rejection facility reaching its nameplate production capacity in the second half of the quarter. But its chief operating officer Vince De Carolis said the peak performance should not be construed as an annualised run rate. The firm said it is not stockpiling its production volume as it sees "ongoing customer demand". Pilbara's spodumene sales volumes rose by 3pc on the quarter and by 14pc on the year to 165,121dmt for an average 5.3pc grade. Pilbara earlier in February defended its lithium downstream strategy and last month signed a binding agreement with Chinese refiner Ganfeng to carry out a joint feasibility study as they explore building a downstream conversion plant. The two firms are exploring building a lithium hydroxide and/or lithium carbonate conversion plant with 32,000 t/yr of lithium carbonate equivalent capacity, alongside a potential intermediate lithium chemical facility in the country. By Joseph Ho Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Coal sales at Australia’s Whitehaven fall in Jan-Mar
Coal sales at Australia’s Whitehaven fall in Jan-Mar
Sydney, 19 April (Argus) — Australian coal miner Whitehaven reported higher production but lower sales in January-March, with the firm increasing its percentage of high-grade thermal coal sales from the previous quarter. Saleable coal volumes rose by 8pc on the year to 3.9mn t but managed coal sales fell by 7pc to 3.8mn t compared to a year earlier. Sales were 83pc high-grade thermal, higher than 72pc in October-December and 68pc a year earlier. Whitehaven said run-of-mine production at Narrabri was below expectations because of the current panel's geological challenges, leading to reliability and maintenance problems with equipment. Whitehaven's overall sales guidance for the 2023-24 fiscal year remains unchanged at 16mn-17.5mn t for 2023-24 with a unit cost guidance, excluding royalties, of A$103-113/t ($66-$72/t) which the firm said is tracking at the top end. This is because of lower output from Narrabri, which is tracking below its output guidance of 5.1mn-5.7mn t for the fiscal year to 30 June. Whitehaven finalised takeovers of Australian-Japanese joint venture BHP Mitsubishi Alliance's (BMA) 12mn t/yr Blackwater and 4mn t/yr Daunia coking and thermal coal mine in Queensland on 2 April, with initial sales and production data to be reported in its April-June production report. The two mines are anticipated to deliver 4.5mn-5mn t run-of-mine output in April-June, with Whitehaven's revenue breakdown to be 70pc metallurgical and 30pc thermal on an annual basis post-acquisition as it seeks to pivot toward coking coal. Blackwater and Daunia contributed 10.11mn t and 4mn t respectively to BMA's total output in 2023. Whitehaven plans to sell down a 20pc stake in Blackwater to global steel producers, with a process presently underway. Whitehaven views the high calorific value (CV) thermal coal market as well supported in its key Asian markets, and said tightening of sanctions on Russian exporters is containing global supply. India's continuing growth is driving demand and underpinning price sentiment, Whitehaven said, despite a softening in metallurgical coal prices during the quarter . The Argus high-grade 6,000 kcal/kg NAR price averaged $126.74/t fob Newcastle and the 5,500 kcal/kg NAR coal price $93.85/t during January-March, compared with $134.23/t and $96.80/t respectively for October-December. By Tom Major Whitehaven quarterly results Jan-Mar '24 Oct-Dec '23 Jan-Mar '23 Volumes (mn t) Managed coal production 3.9 4.2 3.6 Managed coal sales 3.8 4.7 4.1 Managed coal stocks at period end 1 1.5 1.5 Coal sales mix (%) High-grade thermal coal 83 72 68 Other thermal coal 8 19 26 Metallurgical coal 9 9 6 Prices achieved ($/t) 136 142 280 Thermal coal 136 142 280 Metallurgical coal 213 166 234 Source: Whitehaven Australian coal price comparisons ($/t) Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
ISRI rebrands to ReMA, drops scrap from name
ISRI rebrands to ReMA, drops scrap from name
Las Vegas, 18 April (Argus) — The Institute of Scrap Recycling Industries (ISRI) has rebranded to the Recycled Materials Association (ReMA). The new name and rebrand better reflect the evolution within the recycling industry and its member companies, ReMA said at the group's annual convention and exposition in Las Vegas today. Washington, DC-based ReMA represents recycling industries including ferrous and nonferrous metals, electronics, glass, paper, plastics, textiles and tires and rubber. It is a member-driven trade organization that provides advocacy, education, safety and compliance training, and promotes public awareness of the vital role recycled materials play in the US economy, global trade, the environment and sustainable development. ISRI was formed in 1987 when the Institute of Scrap Iron and Steel merged with the National Association of Recycling Industries. Over the last 35 years, the association has seen tremendous growth in size and diversity of its membership, particularly in electronics, consumer brands and EV battery sectors. The trade association has around 1,700 member companies across the US and other 40 countries. By Brad MacAulay Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
BHP cuts Australian met coal sales guidance again
BHP cuts Australian met coal sales guidance again
Sydney, 18 April (Argus) — Australian mining firm BHP has cut its coking coal guidance for the 2023-24 fiscal year to 30 June to a new decade-low of 43mn-45mn t because of the impact of wet weather and cyclones on its Queensland operations. The BHP Mitsubishi Alliance (BMA), which is 50pc owned by BHP and 50pc by Japanese trading house Mitsubishi, had already cut its guidance by 18pc in January to 46mn-50mn t of metallurgical coal for 2023-24, down from the previous guidance of 56mn-62mn t issued in July. At that time it cited the impact of the sale of the Blackwater and Daunia coking and thermal coal mines in Queensland to Australian independent Whitehaven, which it completed on 2 April, maintenance, a fatality at its 10mn t/yr Saraji mine and increased removal of waste. The latest downgrade was blamed again on the Saraji incident, as well as on wet cyclonic weather in Queensland and an inventory rebuild after the impact of flooding and labour shortages in 2022 and 2023. The inventory rebuild will continue into calendar year 2025, which could further weigh on sales into 2024-25. The further reduction in expected sales volumes led BHP to increase its cost guidance for 2023-24 to $119-125/t from $110-116/t in January and from $95-105/t in June. BHP received an average price of $274.99/t for hard coking coal and $204.55/t for weak coking coal during July-December, up from $242.52/t and $190.74/t for January-June and $270.65/t and $252.12/t in July-December 2022. It defines hard coking coal as those with a coke strength after reaction (CSR) of 35 and above, with weak coking coal being those with a CSR of below 35. Argus last assessed the premium hard low-volatile metallurgical coal price at $249/t fob Australia on 17 March, down from $336.50/t on 17 January. By Jo Clarke BHP metallurgical coal sales (mn t) Jan-Mar '24 Oct-Dec '23 Jan-Mar '23 Jul-Mar '23-24 July-Mar '22-23 Coking coal 5.41 4.76 5.37 14.66 16.86 Weak coking coal 0.93 0.75 0.71 2.21 2.04 Thermal coal 0.02 0.20 0.10 0.52 0.80 Total BMA 6.36 5.71 6.19 17.39 19.70 Total BMA (100%) 12.72 11.41 12.37 34.78 39.39 Source: BHP Australian metallurgical coal prices ($/t) Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Business intelligence reports
Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.
Learn more