Anglo assures customers of 3Q met coal shipments
UK-South African mining firm Anglo American has today informed several steel mills and trading firms that it expects to meet its contracted obligations for the third quarter, Argus has learned. This follows the closure of Anglo American's 5mn t/yr Grosvenor coking coal mine in the Bowen basin region of Australia's Queensland, following an accident in late June.
Anglo American is "evaluating the impact of this incident and is expecting to perform on its third-quarter obligations as planned at this moment, subject to change depending on further assessment", an Asian steel mill source said. Others said the same, with an Indian buyer stating that the company is "not expecting any material impact to supply in the short term, since the miner is expected to meet third-quarter commitments".
Some sources cautioned that cargo delays are still anticipated, with one trading source expecting delays of more than 20 days.
Production at Grosvenor had been strong for the past couple of months, after a challenging 2023. The producer increased spot offers on the market in the past two months, with at least three July-loading Panamax cargoes sold and at least two Panamax cargoes being offered for August loading, before the 29 June accident.
The paper market also cooled down today after sharp increases earlier this week, market participants said. Fob Australia premium futures contracts were trading at around $253-254/t and $257-258/t for July and August, respectively, on 3 July, falling by around $8-10/t from 2 July.
Supply availability for the fourth quarter remains uncertain, with some market participants expecting the market to tighten in anticipation of stronger demand. "There is some demand surfacing from India this week for August and September-loading cargoes, so prices may see some support once September cargoes are being discussed, because other mines are also going to be in maintenance during that time," an international trader said.
The Argus premium low-volatile hard coking coal price was assessed at $257.50/t fob Australia on 3 July, down by $2.10/t from 2 July.
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Asia-Pacific coking coal: Fob trades at $260/t
Asia-Pacific coking coal: Fob trades at $260/t
Singapore, 2 July (Argus) — Coking coal prices on a fob Australia basis jumped after an August Goonyella deal emerged higher on traders' position-taking, against a background of anticipated supply tightness. The Argus Australian premium low-volatile (PLV) hard coking coal price rose by $22.60/t to $259.60/t on a fob basis, while the tier-two hard coking coal price rose by $18.50/t to $225.50/t fob Australia. Trading returned to the first-tier fob Australia market today after more than a week of subdued activity. A major producer sold a 40,000t Goonyella cargo with 1-10 August laycan to a trading firm at $260/t fob Australia on the Globalcoal trading platform today. The trade was in line with market expectations of tightening supply, providing a lift to coking coal prices. The suspension of operations at Anglo American's Grosvenor mine in Queensland has prompted a sharp change in market sentiment, sources noted. Sentiment had been bearish over the previous week, before taking a bullish turn when the news of the closure broke over the weekend, an India-based trader said. Several sources said the increase was on the high side, as there has been limited change in recent market fundamentals to warrant such a rise. Recent events made it challenging to gauge where the market price should be, a Singapore-based trader said, preferring to adopt a wait-and-see approach towards near-term market direction. But users in the region were largely sceptical on whether the uptrend can be sustained, suggesting that demand remained muted their end. "We don't have any urgent requirement at this point and will wait for an update from the miner before acting," an Asian steel mill source said. Several steel mill sources also pointed out that they have accounted for limited supply from the miner in August-September because of a scheduled long wall move. At least three steel mill sources expected the miner to have sufficient inventory to meet the commitments for scheduled July-loading cargoes. A bid for a 75,000t cargo of premium mid-volatile hard coking coal for 1-10 September was made at $255/t fob Australia on Globalcoal today, increasing from $250/t fob earlier in the session. It did not attract a counteroffer. In the pulverised coal injection (PCI) segment, a 40,000t cargo of Australian South Walker Creek PCI for 27 July-5 August loading was sold at $195/t fob Australia to a Brazilian steel mill on 1 July after the assessment timestamp of 17:30 Singapore time. Premium hard coking coal prices to India rose by $22.25/t to $275.35/t on a cfr basis, while second-tier prices rose by $18.60/t to $241.70/t cfr east coast India. The PLV hard coking coal price to China was unchanged at $247/t on a cfr basis today, while the second-tier price was flat at $217/t cfr north China. Market participants noted that the trade seemed to have minimal impact on the Chinese market. An international trader suggested that domestic coking coal prices held steady because of Russian and Mongolian coal availability. The link between the seaborne and domestic market has been disjointed for a while now, another trading source said, even though fob prices are expected to climb because of tightening seaborne supply. "At the current fob Australia price levels, it is difficult for Chinese buyers to consider buying imported coal since other origins of seaborne prime coals are also expected to increase at a relativity to the fob Australia price," a Chinese buyer said. Fob Australia rationale The fob Australia PLV index was based on an average of the day's deals and surveys, both weighted at 50pc in the index calculation. A 40,000t cargo of Goonyella with an August laycan traded at $260/t fob Australia and was normalised flat. The market survey was at $255-260/t and averaged $259.17/t. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
S Korea's LGES, Renault sign 39GWh LFP battery deal
S Korea's LGES, Renault sign 39GWh LFP battery deal
Singapore, 2 July (Argus) — South Korean battery manufacturer LG Energy Solution (LGES) will supply 39GWh of lithium-iron-phosphate (LFP) batteries to French car manufacturer Renault's electric vehicle (EV) division Ampere from 2025-30. Under the agreement, LGES will provide LFP batteries in pouch form to Ampere from the end of 2025 through to 2030, said LGES on 2 July. The batteries will come from its facility in Poland where it has a 86GWh battery plant, which is the largest in Europe. This marks the firm's first "large-scale" LFP battery supply deal for EVs, said LGES. The firm will continue to expand its supply of LFP batteries for EVs, starting with the European market, said the firm. LFP batteries are typically more cost-competitive compared to nickel-manganese-cobalt (NMC) batteries given the materials used, and LGES sees demand rising for the former as demand for affordable entry-level EVs grows. Ampere earlier said it will be integrating LFP technology alongside the NMC batteries that Renault has been using, because of market volatility and changes in battery technologies. LGES and Chinese battery manufacturer CATL will provide Ampere with LFP batteries and technology, with LGES providing batteries from its Poland facility, and CATL providing the technology until 2030. The three firms will set up an "integrated value chain" in Europe, said Ampere. The decision to integrate LFP and cell-to-pack technologies — which raises the volumetric density of batteries — will help Ampere in cutting 20pc of its battery costs, said the company. This is part of the firm's roadmap to cut 40pc of costs by 2027 or 2028. Ampere targets to sell 1mn units of EVs in 2031 with a goal of reaching €25bn ($26.83bn) in revenue that same year through seven of its EV models, said the firm late last year. Sales of plug-in EVs, which include plug-in hybrid EVs and battery EVs, fell by over 10pc in Europe during May on weak German demand, with sales of hybrid EVs rising by 15pc on the year across the EU, European Free Trade Association and the UK. By Joseph Ho Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Tata Steel BF to stay on as Unite suspends strike
Tata Steel BF to stay on as Unite suspends strike
London, 1 July (Argus) — Union Unite has agreed to suspend its "indefinite" strike action which was due to start at Tata Steel site on July 8. Tata had said it would need to prematurely close blast furnace four (BF4) this week due to safety and operational concerns if the strike went ahead. Blast furnace five is being taken down, in line with the company's earlier plan. In a note to Unite members seen by Argus today, Unite representatives said they had decided to suspend all action, including "working to rule, overtime ban and strike action" after talks with Tata over the weekend. "We welcome Unite's decision to withdraw their strike action and get back around the table with their sister steel unions", Alun Davies, national officer for Community Union, said. "Tata confirmed that if the strike was called off they are ready to resume discussions on a potential MOU (memorandum of understanding), through the multi-union steel community," he added. Tata has commenced legal action to challenge the validity of Unite's ballot and a court hearing is scheduled for 3 July, Tata Steel UK chief executive officer Rajesh Nair said in a note to Tata employees on 28 June. Tata had met with Unite on 28 June, where the union confirmed it would provide "minimum safety cover" at Port Talbot and Llanwern during the strike, but Nair said this was "not sufficient" to allow safe operations, and the closure of the furnaces and heavy end would start this week. However, sources expect BF4 and the steel plant will continue running now the threat of imminent strike action has been withdrawn. By Colin Richardson Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
ASD completes purchase of Atlantic Steel Processing
ASD completes purchase of Atlantic Steel Processing
London, 1 July (Argus) — UK general steel distributor ASD has acquired the assets of Birkenhead-based decoiler Atlantic Steel Processing out of administration. The group, now owned by Spain's Hierros Anon, said the acquisition will enhance its presence in the UK's northwest and give it cost-effective access to the Irish markets — previously Ireland was an important region for Atlantic. Atlantic also introduces new products to ASD, in the form of decoiled hot-rolled sheet and reversing mill plate. Atlantic has the widest decoiling line in Europe, Yoder, capable of processing 2.5m-wide material. Hierros Anon has been on something of an acquisition spree of late, recently acquiring four country operations from Kloeckner, including ASD in the UK. Atlantic fell into administration on 3 May , as first reported by Argus . The business was affected by a difficult UK hot-rolled coil (HRC) and sheet market, and had a lack of cash after a management buyout in 2022. Continued difficult market conditions are likely to see more consolidation in the service centre and decoiling markets in the coming weeks, sources said. By Colin Richardson Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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