Hebei likely to witness a small hike in coking coal prices

Friday, 05 Aug 2011

coking coal market in Hebei Province operates stably recently and is slated to increase at a later stage.

In late July, domestic steel market eyed an uptrend. MySpic on August 2 was seen at 177.4 up by 0.27% DoD, 0.7%WoW or 2.12%MoM. In line with the ongoing improvements of steel market, steel mills and coking plants are more willing to replenish coking coal stocks.

The government is planning to shut down 130 small coal mines in Hebei Province in the near term with 6.6 million tonnes of outdated capacity involved. Yet most of the crucial coking coal supply relies on local small mines. Thus the shutdown may affect the normal production of some small coking and steel companies.

The coking coal from Inner Mongolia to Hebei remains tight, leaving an impending upward price hike of CNY 10 per tonne to CNY 20 per tonne this month. Simultaneously, due to the consolidation of coal mines in Shanxi, raw coking coal supply limitation has sharply slowed down the supply of coal to Hebei. In addition, more small and medium coal washeries in Hebei, being subjected to thin profits have to curtail or stop production. The overall strain of coking coal supply thus makes imports a favorable option.

(sourced from MySteel.net)

Gladstone Port: coal stocks over 50% normal volume

Wed, 1 Feb 2011,
PERTH Feb2 (Reuters) - Australia's Gladstone Port Corp said on Wednesday that its stockpiles have increased to just over 1 million tonnes of coal as it recovers from the flooding that disrupted coal supplies, little more than half the 2 million tonnes it normally holds.
The port, which is outside the warning area for Cyclone Yasi and does not expect to be affected by the storm, expects to ship about 500,000 tonnes of coal this week, the company said in a statement.
(Reporting by Rebekah Kebede; editing by James Regan, sourced:reuters)

Taipower seeks coal in spot market after Queensland floods

Wednesday, 26 Jan 2011
Taiwan Power Co said that it is seeking coal cargoes in the spot market after floods in Australia’s Queensland state disrupted contracted supplies.

Ms Tu Yueh-yuan chief engineer of Taiwan Power in an interview in Taipei said that Taipower expects supplies from Queensland, which accounts for 15% of the company’s total coal needs, to return to normal in March.

She said that Taipower expects to buy 27 million tonnes of the fuel this year.
(Sourced from Bloomberg)

Floods forces Asian steel mills to look elsewhere for coking coal

Wednesday, 26 Jan 2011

Japanese and South Korea have been seeking alternative suppliers of coking coal for their steel mills since the scale of the Australian floods became apparent earlier this month.
Japanese steel mills, which last year secured more than 50% of their coking coal from Australia, are looking to North America, Africa and Indonesia. South Korea is the second-biggest importer of Australian coal after Japan.

Mongolia which has just begun to tap the world's second biggest coal seam is also expected to be a threat to Australia's market share.
Chinese imports of coking coal increased from 6.85 million tonnes in 2008 to 34.49 million in 2009. But with the world's biggest coal reserves, China, the world biggest steelmaker, has only recently become a coal importer.
Galaxy Futures analyst Ms Liu Huiru said that Australia provided about 38% of China's coal imports. She said that "Along with the recovery of the international economy, China will face competition from other countries in demand for coke. Imports from Australia, the US and Canada might decrease, while imports from Mongolia might increase, and the same with Russia.”
Mysteel.com analyst Zhu Xi'an said that major coking suppliers in China's coal producing provinces of Shanxi and Hebei had raised prices about CNY 100 (USD 15.40) a tonne since the start of the year, especially since news of the floods spread.
He said that "So far the floods are a short term effect, but if the situation in Australia does not improve by March the market here might have a stronger response."

(Sourced from The Australian)

Analysts see coking coal shortages

Monday, 17 Jan 2011

Bloomberg reported that several analysts’ sees floods in Australia disrupting coking coal supplies and boosting steel making costs.
RBS Equities analyst Mr Rahul Jain without giving estimates said that stoppages in coal shipments from Queensland State under force majeure clauses are likely to create a shortage in the April to June quarter, forcing steelmakers to lower production.
Mr Rakesh Arora an analyst at Macquarie Group Ltd in Mumbai said that steelmakers may also raise prices to cover cost increases.
Mr Giriraj Daga an analyst at Nirmal Bang Securities Ltd in Mumbai said that the worst floods in 50 years in Australia’s largest coal exporting region is creating a raw material shortage in India, where steel demand is forecast to grow 10% in the year to March 31. Profit margins at Indian steelmakers may shrink more than 10% next quarter because of an increase in fuel costs.
Mr Mark Pervan, head of commodity research at Australia & New Zealand Banking Group Ltd in Melbourne said that Queensland, which accounts for about 20% of Australia’s AUD 1.3 trillion economy is losing AUD 480 million a week in coal exports
According to Mr Petersfield Englandbased researcher IHS McCloskey, Australian coking coal rose to USD 265 a tonne on average last week from USD 248.
Sourced from Bloomberg