Over the past week steam coal quotations on the European market strengthened above 335 USD/t, driven by shortage of imported material in the EU amid approaching embargo on Russian coal. Decrease of wind generation volumes in a number of EU countries and news on possible ban on Russian oil exports also supported coal indices.
Coal stocks at ARA terminals increased to 5.2 mio t (+0.2 mio t w-o-w), which is the highest level since December 2020.
Increased demand for South African material from the EU countries, trying to replace Russian coal supplies, had a positive effect on South African indices, rising above 310 USD/t. Additional factor for prices growth is continuing issues with railway line, connecting coal-mining provinces of South Africa and Richards Bay Coal Terminal (RBCT).
In China, spot prices for 5500 NAR slumped by 90 USD/t to 102 USD/t FOB Qinhuangdao. Steam coal quotes in Chinese domestic market fell after China zeroed import duties on coal, starting from May 01, 2022, to stimulate economic development on the back of increased production and reduced electricity consumption, resulting from restrictions related to the new wave of COVID-19 in the country.
Australian coal indices strengthened above 365 USD/t amid a series of large purchases in the physical market and the next fiscal year’s benchmark negotiations between Japan and Australia.
Increased trading activity by Indian power generating companies, which are restocking due to record high average daily temperatures, supported indices of Indonesian material 5900 GAR to 200 USD/t. Extreme heat in India led to a rise in power consumption, which reached an all-time high of 207 GW in the last week of April.
The growth in demand for Australian coking coal from steel mills in the Asia-Pacific region continues to be positively reflected in the dynamics of Australian coal prices, which are maintaining at the level of above 500 USD/t.
Source: CAA
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