The price of Atlantic met coal remained steady Monday, following recent modest fluctuations, with mills and traders moving into the negotiation period for both contract and spot deals.
One European-based trader said he would be buying in the next two weeks and that the Platts assessment of $134.50/mt FOB USEC for low-vol hard coking coal was a realistic level for what he would expect to pay. He said also there had been some additional buying interest from South America.
Platts assessed US low-vol hard coking coal flat at $134.50/mt FOB USEC, based on CAPP coal with CSR normalized to the high 50s bracket.
Spot prices for US high-vol A were also steady at $127.50/mt FOB USEC but high-vol B came off $1.50 to $117/mt FOB USEC owing to lower offer prices.
A buyer for one Eurasian mill said they had collected a number of tenders recently and that it would be deciding purchases this week.
The buyer added that they expected to pay around $140/mt CFR Turkey for contract mid vol blend with VM 24-26%; sulphur max 0.9% and ash of 8%; and that the US had made the most competitive offers compared with Colombia and Australia.
With current freight costs as low as they are -- Hampton Roads to Rotterdam is now at $11.90/mt -- the US is in a good position. To Turkey the freight rate of around $17-18/mt would give a netback of around $122/mt FOB USEC for the mid vol blend at $140/mt CFR.
One US producer said he believed prices would begin to rise in October but that he was not entering the spot market at the moment as he had sold all his material and that to justify an increase in production would require an increase of some $30/mt on the current spot price and would also have to be sustainable.
