Commodity Market Report

Metallurgical coal market short-term outlook June 2021

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30 June 2021

Metallurgical coal market short-term outlook June 2021

Report summary

Met coal prices are rising, fuelled by forced outages at Chinese mines and shortages at coke plants. China CFR prices crested US$300/t and Australian PLV is near US$190/t. Volatility remains extraordinarily high, in an illiquid market. We consider the recent incendiary forces acting on the market to be temporary. Prices should ease in early July as Chinese mines are nominally set to return from 5 July. Mongolian imports should also restart in early July at Ganqimaodu, after being closed due to a positive covid case. India’s monsoon and seasonal construction slowing in southern China will also dampen demand during Q3.

Table of contents

  • Chinese mine closures supercharge a hot market
    • Chinese supply to improve
    • Chinese demand under pressure
    • India demand will slow during the monsoon season
    • Prices to fall but timing is uncertain
    • China’s economy and industrial production still strong, but should taper
    • China steel production remained strong in June but is showing signs of topping out
    • China’s seasonally weak construction period has begun with less speculative steel buying
    • China’s steel margins are falling, leading to a good time for maintenance activity
    • Brazil’s demand strong enough to induce blast furnace restart
    • Despite tepid domestic demand, Indian steel recovering on improved exports
    • EU votes to extend steel quotas for three years
    • Australia: Queensland met coal throughput continues to climb
    • Australia: Moranbah North back up and running
    • Australia: Sojitz Blue commits to Crinum
    • Australia: Queensland welcomes new met coal producer to its ranks
    • US: metallurgical coal supply still constricted
    • US: Coking Coal LLC looks to reopen Pardee HV mine
    • Canada: Riversdale denied mine and environmental license/approvals for Grassy Mountain mine
    • Mongolia: new rail line completed from Tavan Tolgoi
    • Mongolia: coal crossings still at a snail’s pace, due to virus levels
    • China: domestic coal production severely restricted until 5 July
    • Russia: producers continue efforts to raise exports

Tables and charts

This report includes 6 images and tables including:

  • Key prices - history & quarterly forecasts (US$/t nominal)
  • Global and Chinese crude steel production (Mt)
  • Global and Chinese blast furnace hot metal production (Mt)
  • Crude steel production - ex-China producers (Mt)
  • Blast furnace hot metal production - ex-China producers (Mt)
  • Queensland ports: Metallurgical coal exports (Mt per month)

What's included

This report contains:

  • Document

    Metallurgical Coal Markets Short Term Outlook Data June 2021.xlsx

    XLSX 636.11 KB

  • Document

    Metallurgical coal market short-term outlook June 2021

    PDF 934.11 KB