Commodity Market Report

Global metallurgical coal short-term outlook January 2018 - Prices start to decline

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01 February 2018

Global metallurgical coal short-term outlook January 2018 - Prices start to decline

Report summary

January has seen the metallurgical coal market regain some balance, as Dalrymple Bay Coal Terminal has worked down vessel queues and demand for spot shipments has softened. With markets becalmed, low-volatile Australian spot prices fell about US$50/t during the second half of January. A relative period of quiet is upon us as China celebrates the New Year, and the market awaits some guidance on policy direction from the two sessions forum in March 2018. This year Australian miners are in a position to increase exports by 10 Mt over 2017, and improving availability of hard coking coal both in China and internationally, underpins our view of lower prices during 2018. However, supply is still fragile. Winter weather in the northern hemisphere and the threat of storms in Queensland’s wet season could crimp miners' plans in the rest of Q1 and early Q2. China's ability to grow production is further complicated by Government plans around supply reform and environmental protection.

Table of contents

    • Key market data (selected)
    • The market is moving closer to balance
      • Weather issues continue to threaten supply
      • US high-volatile price rise
    • Queensland exports rise in December
    • Queensland ports: metallurgical exports (Mt)
    • A derailment on the Blackwater line may slow exports
    • Bounty Mining to restart Cook
    • BHP lowers FY 2018 performance 3 Mt – as Q4 2017 was down
    • Glencore is selling the Tahmoor mine to GCF
    • Glencore production is steady at Oaky Creek complex – despite strike
    • Hampton Roads ports experience brief storm closure
    • Alpha expects lower met output than 2017
    • Teck’s Elkview mine likely to lose minimal output to drier explosion
    • Grande Cache mine could restart in 2018
    • New US high-volatile mine possibilities
    • US corporate tax reduction not expected to have large impact on coal
    • Kolmar continues developments on Russian MV mines
    • New Russian Black Sea Terminal to focus on PCI
    • Rising Chinese coke exports will crimp seaborne metallurgical coal demand
    • Ilva deal closure delayed as it faces challenges from several fronts
    • Europe steel demand increased in 2017
    • Global steel and hot metal production tapered late 2017

Tables and charts

This report includes 7 images and tables including:

  • Executive summary: Table 1
  • Supply: Image 1
  • Global and Chinese steel production(Mt)
  • Steel production - other major producers (Mt)
  • Global and Chinese blast furnace iron production (Mt)
  • Blast furnace iron production - other major producers (Mt)
  • Key prices - history and quarterly forecasts (US$/t, nominal)

What's included

This report contains:

  • Document

    cms metallurgical trade short term outlook january 2018.xls

    XLS 2.43 MB

  • Document

    Global metallurgical coal short-term outlook January 2018 - Prices start to decline

    PDF 458.75 KB

  • Document

    Global metallurgical coal short-term outlook January 2018 - Prices start to decline

    ZIP 1.91 MB