Steelmakers chase US coking coal price advantage

Beijing (Energy Publishing) - Coal traders have confirmed that steelmakers in central China are buying US coking coal, taking a price advantage over preferred Australian product with latest quotes of US$160/t FOB Baltimore and $210/t CFR from Gulf of Mexico ports.

The steel companies, notably in Shanghai city and Jiangsu and Zhejiang provinces, are blending with local coals to counter the higher (1.5%) sulphur levels of cargoes from the US.

Traders caution that price-sensitive Chinese customers will keep buying US coal only while spot markets and freight rates offer them advantages.

Meanwhile, reports in China say Japanese steelmakers also are dabbling in the US met coal spot markets, also hoping to shave prices against Australian numbers.