Coking coal price tends to hit the lowest level in 6 years

The sluggish steel market continues to worsen the situation on the coking coal market, which, with low demand intensity in tandem with oversupply, significantly reduces price levels.

Increases in supplies from Australia and North America are driving down spot coking coal prices and base contract rates. Delaying the floods that normally paralyze Australia's Queensland have boosted shipments from the world's largest exporting region of coking coal to record volumes. Likewise, weakening demand for finished products in India and China is putting pressure on prices. Coking coal prices in China are down 20 percent to $ 107 per tonne since December 31.

India's steel production of construction and automotive markings fell 3.2 percent in February. The three largest companies, TATA, PARUS and JSW, are in the midst of negotiating coking coal prices for the next quarter. These prices are 13-14 percent less than in the first quarter ending March 31 and are the lowest since 2008.

Recently, a deal was concluded to supply Australian coal to the Indian market at 115 FOB. The verdict will be decided in a few days, and Indian factories are likely to benefit from the estimated price by cutting costs on coal prices, and the demand cycle is unlikely to start in the country until the end of elections and the formation of a new stable government.