Commodity Market Report

Global metallurgical coal short-term outlook June 2019: Metallurgical coal prices tested as steel margins falter

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26 June 2019

Global metallurgical coal short-term outlook June 2019: Metallurgical coal prices tested as steel margins falter

Report summary

Evolving weakness in prices this month has ignited some concern amongst miners, eyeing the potential of worsening trade tensions, ongoing import quotas in China, and potential supply increases later this year. The immediate outlook is for further weakness, but the price declines so far are occurring largely as expected, and have been comparatively modest. Price support from China still lies around US$190/t and we expect moves to protect economic growth in China will help the market avoid major price falls for premium coals. Spot PCI and SSCC prices look set to struggle, despite a shortage of availability. Prices for premium HCC will fall below US$190/t during July and August but we expect a return to US$200/t plus prices sometime in Q4 as supply tightness reclaims its place as the dominant market force.

Table of contents

  • Pressure on prices to remain in Q3 before Q4 recovery
  • Trade dispute and import quotas still the greatest risk to our forecast
  • PCI and SSCC spot prices languish but does it matter?
  • Australia: Still waiting for a discernible improvement
  • Anglo American's expansion could be higher than our expectations
  • Ukraine & Russia: import restrictions may add to Asia weakness
  • Teck showing restraint while minors pursue growth
  • Global steel production rates spike on Chinese performance
  • China: Trade dispute piles on pressure
  • Chinese Government moves to provide some relief
  • Authorities aim for stability in property sector
  • Europe: Steelmakers facing multiple threats
  • Korea: Steelmakers fall foul of environment controls

Tables and charts

This report includes 6 images and tables including:

  • Key Prices - history and quarterly forecasts (US$/t, nominal)
  • Queensland Ports: Metallurgical coal exports (Mt)
  • Global and Chinese crude steel production (Mt)
  • Crude steel production - other major producers (Mt)
  • Global and Chinese blast furnace hot metal production (Mt)
  • Blast furnace hot metal production - other major producers (Mt)

What's included

This report contains:

  • Document

    cms_metallurgical_trade_short_term_outlook_June_2019.xls

    XLS 3.00 MB

  • Document

    Global metallurgical coal short-term outlook June 2019: Metallurgical coal prices tested as steel margins falter

    ZIP 2.64 MB

  • Document

    Global metallurgical coal short-term outlook June 2019: Metallurgical coal prices tested as steel margins falter

    ZIP 2.64 MB

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