Commodity Market Report
Global metallurgical coal short-term outlook March 2020: coronavirus spurs unprecedented demand and supply swings
Report summary
As the world continues to grapple with the coronavirus outbreak, March brought the kind of global economic slowdown not seen for decades. The collateral damage to the steel sector has rapidly changed the outlook for metallurgical coal, as blast furnaces are idled and production is cut. China’s support for import spot prices over the last two months is under threat as coking coal supply to China's mill fleet improves. And a hiatus of imports into India will mean much more competition amongst suppliers into China and the rest of Asia. Prices in April will be lower than March, and there is a risk of steep declines if supply holds up in Australia, Canada and Russia. However, the measures taken to combat the spread of coronavirus are unique in scope, and impossible to accurately predict. Impacts on coking coal supply have been muted to date outside the US, but could expand quickly, and may ultimately protect met coal prices from prolonged, deep cuts into the cost curve.
Table of contents
- China has played a supportive role for prices
- but the demand shock from blast furnace shutdowns has changed the dynamic
- Lockdown in India will divert cargoes toward China
- Metallurgical coal production holding up, for now
- Prices to fall as demand loss outstrips supply
- How far might prices fall?
- Australian supply steady for now, but special challenges await
- New Zealand suspends met coal exports
- Chinese domestic supply returning
- Mongolian coal starts moving to China
- Teck expects lower 2020 exports due to logistical issues
- Canada’s Donkin mine succumbs to difficult mining conditions
- US miners idle production to curb coronavirus spreading
- US states make mixed moves on coal production stops
- China could shine as a bright spot in the seaborne market
- Europe automotive industry closes
- ArcelorMittal Europe declares force majeure on feedstock deliveries
- Other European steelmaking downward production adjustments
- ArcelorMittal and Italy agree to new plan for Taranto steel mill
- US automotive to convert production lines to ventilator production
- Brazil idles a blast furnace at Tubarao
- India idles blast furnaces and faces port challenges
Tables and charts
This report includes 6 images and tables including:
- Key Prices - history & quarterly forecasts (US$/t nominal)
- Queensland ports: metallurgical exports (Mt)
- Global and Chinese crude steel production (Mt)
- Crude steel production – Ex-China producers (Mt)
- Global and Chinese blast furnace hot metal production (Mt)
- Blast furnace hot metal production – Ex-China producers (Mt)
What's included
This report contains:
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