Atlantic Coking Coal: Prices Hold Steady
February 11, 2021 - US coking coal prices held firm this week, supported by supply tightness and willingness by some Chinese mills to pay a premium to secure Atlantic basin coal.
The Argus-assessed US low-volatile price moved up by $1/t today to $158.50/t fob Hampton Roads, driven by a deal heard done for a February-loading cargo to China, after prices edged down last week amid softening demand. The high-volatile A and high-volatile B assessments held steady at $153.50/t fob Hampton Roads and $136.50/t fob Hampton Roads, respectively, supported by limited spot availability for the second quarter.
Despite Chinese market participants having largely exited the market ahead of the lunar new year holiday that officially starts on 12 February, pockets of market activity have emerged this week.
A Panamax cargo of February-loading Blue Creek #7 was heard to have traded today at $220/t cfr China, lending support to the US low-volatile price. But this cargo is understood to have changed hands more than once, market participants familiar with the coal suggested.
A European trader is understood to be in the late stages of selling a cargo of Pinnacle coal to a Chinese buyer and is in talks to close another sale for Pinnacle coal before the end of the week. Otherwise, Chinese market participants have largely exited the market ahead of the holidays.
A cargo of Harpoon mid-volatile hard coking coal was also heard to have been offered to a Chinese mill this week.
The European spot market remains muted but tight supply availability has kept any offers for the second quarter or later firm. Most mills are well supplied by their term contracted volumes in the first quarter. "First-half scheduling for my European customers is very good, partly due to 2020 underperformance [of term contracts] carrying over. This also explains the lack of spot activity," one US miner said.
A European mill had sold a cargo of second half March-loading Peak Downs at $139/t fob Australia today. But details of the deal were confirmed after the Singapore timestamp for the Australian premium low-volatile assessment.
A European trading company is offering a March-loading 10,000t met coke cargo with 60 CSR at $370/t fob Black Sea or $410/t fob Baltic, to take into account distance and port handling costs.
The mid-volatile Colombian assessment rose by $2.50/t to $135/t fob Colombia yesterday, buoyed by high demand and robust met coke prices. But spot trade is sporadic, with volumes mostly channelled to domestic coke producers.