[Ferro-Alloys.com] US coking coal prices held mostly steady at the end of this week, with European demand muted for the third quarter but confidence among US mining firms is holding up despite weakness in Asia.
European demand is not expected to show significant recovery until well into the fourth quarter, but a string of Brazilian tenders for second-half shipments awaiting results have supported sentiment in the Atlantic. The effect of supply disruptions in the US in the second quarter and some mines still waiting to fully resume operations mean US firms are in a comfortable position, market participants said. A Brazilian steel mill has issued a 10,000t tender seeking a trial cargo of low or mid-volatile coals. But the small volume points to the likelihood this is aimed at existing US and Australian suppliers with spare capacity on an existing shipment to Brazil.
Raw steel production in Latin America rose by 8pc in May compared with April, mostly driven by Brazil, where production and consumption grew from a low base in April. This is down by 22.6pc on the year with capacity utilisation at just 51pc, the Brazilian Steel Association said.
Spot demand in the Atlantic is largely restricted to Brazilian and Turkish mills for the third quarter, and despite healthier inventories at mines, some suppliers may still be open to discounts, some traders said. "I know for a fact that Brazilians buy at a discount to the high-volatile B index," one US trader said. But he added that his clients are not in the market.
Copyright © 2013 Ferro-Alloys.Com. All Rights Reserved. Without permission, any unit and individual shall not copy or reprint!