Indian, Chinese met coal demand to grow, but supply to keep pace: Wood Mac
India and China remains hot spots for coking coal demand, with both countries seeking imports of premium low-impurity coal to meet growth and steel quality, but supplies should easily keep pace, consultants Wood Mackenzie said.
Demand in India should grow as a result of expanding steel output and as companies leave bankruptcy, Wood Mac director for global met coal markets, Jim Truman, told the Eurocoke Summit in Dusseldorf.
Companies such as RINL, SAIL, Bhushan Steel and JSW are expected to drive coking coal consumption and PCI demand growth in the coming year, he said.
In China, domestic premium low-vol HCC supply is limited at less than 10 million mt, leaving a gap for low sulfur grade imports, Truman said, citing analysis of China’s coking coals by grade.
Globally, Wood Mac expects 23 million mt of hot metal demand growth, which implies 5 million mt in seaborne met coal growth.
In the US, steel import tariffs may drive demand for 3.8 million mt of coal as a result, Truman said.
Despite the increase in demand, coking coal supply growth, led by Australia and the US, may provide a buffer, exerting pressure on prices, he said.