January 21, 2021 - US coking coal prices have held firm early this week, as they remain supported by limited spot availability and continung interest from buyers in Europe, China and South America. But procurements have slowed since December as buyers take stock of their requirements for March and beyond, amid some uncertainty over the resurgence of Covid-19 in China.

The Argus-assessed US low-volatile price eased off slightly, moving down by $1/t to $158/t fob Hampton Roads, as Chinese buyers appeared to hold off accepting the most recent increase in cfr China offers from Canada. The high-volatile A assessment edged up by $1/t to $151.50/t Hampton Roads, as availability remains tight for the second quarter and offers push towards $152-153/t. The high-volatile B price is assessed 50¢/t lower at $129/t fob Hampton Roads, in line with second-quarter offers amid supply tensions.

A cargo of Canadian Raven for March loading was heard to have been offered at about $214/t cfr China, while a cargo of Canadian Standard was offered at a similar level for March loading. But as these offers edge closer to Chinese domestic prices, Chinese buyers and traders have not been as quick to accept these levels. Rumours about Beijing possibly easing restrictions on Australian coals may have given buyers some confidence to hold off until they have greater clarity on the situation, market participants said. But US and Canadian mines said they are continuing to receive enquiries for more spot cargoes throughout this year, particularly from Chinese buyers seeking low-volatile cargoes.

The rising iron ore and coke prices, combined with falling Chinese domestic steel prices and the Covid-19 resurgence in Hebei, have put a pause on buying this week. "Buyers are waiting for some clarity on raw materials prices and whether or not mills will run during the lunar new year," a trader said. If workers are prevented from returning to their home towns over the holiday period because of measures to control the spread of the virus, construction work may carry on and continue to drive steel demand, unless also halted by Covid-19 restrictions, some Chinese market participants suggested.

Demand has continued to pick up slowly in Europe, a trader said, but low first-quarter availability of US coal has kept the market quiet in the past few days. A US mining firm has received enquiries recently from coke producers in eastern Europe but had little availability to offer. Most European mills are understood to be focused on finalising term volumes for the year. "A lot of European mills have their term business to finalise and it is a bit early to look at spot for now," one US miner said.

A cargo of Australian premium low-vol coal that sold last week for $124/t was bought by a Brazilian mill.