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1. THE MET LETTER Market Update: 10th December 2014
SPOT & FORWARD PRICE DATA
Product Spot-Nov Dec-14 Jan-15 Feb-15 Q1-15 Q2-15
Platts PLV FOB Australia US$/mt 110.67 110.50 110.50 111.00 111.00 111.63
W-o-W +0.25 0.00 +0.50 +0.25 +0.63
TSI PHCC FOB Australia US$/mt 114.07 113.25 112.50 113.00 113.00 113.75
W-o-W +0.75 -0.50 0.00 0.00 0.00
TSI JM25 PHCC CFR China US$/mt 123.23 122.63 121.88 121.75 121.75 123.00
W-o-W +0.13 -0.37 -0.50 -0.50 +0.75
COMMENTARY
OO The Platts PLV FOB assessment ended Friday at US$110.50/t,
$0.10 lower WoW, whilst continuing to trade within a tight range.
The TSI FOB Australia index has not moved at all, sticking to
US$114.00/t whilst TSI’s JM25 CFR China index lost $0.40 on
Monday’s close.
OO Though premium low volatile grades look to be unchanged,
the premium medium volatile segment has seen a small surge
in prices, tightening the spread to the low volatile grades.
Increasing demand for these grades of coal due to excellent
blending characteristics, lower ash and a lower price point than
premium low volatiles has seen Indian importers move in and
pick up a few cargoes.
OO This week has been relatively stable in terms of arbitrage
opportunities, with WoW changes showing a small tightening,
US$1.53, primarily due to the rise seen this week in the Dalian
Jan15 contract. This is in line with the up tick in front month Iron
Ore and Rebar futures as steel mills in northern China raised
buying volumes.
OO Monthly benchmarks for certain Chinese domestic coke and
coking coal grades remain unchanged into November, though
we are hearing a potential positive market vibe as we enter the
more seasonally bullish winter period. Rising freight costs and
adverse mining conditions could contrive to bring imported
coking coal on a more competitive level with domestic material.
OO Capacity utilization at Chinese coking plant was on average
around 76% with about 19 days’ worth of coking coal held in
inventory, down slightly from the week before.
Spot History Forward Curve
Jun-14
Dec-14
Dec-14
Cal16
Jun-14
Dec-14
Dec-14
Cal16
TSI Premium Hard Coking Coal FOB Australia US$/mt Platts PLV FOB Australian US$/mt
Jun-14
Dec-14
Dec-14
TSI Premium JM25 Hard Coking Coal CFR China US$/mt
$145
$140
$135
$145
$130
$140
$125
$135
$120
$130
$115
$125
$110
$120
$105
$115
Jan-Cal16
Hard Coking Coal FOB Australia US$/mt Platts PLV FOB Australian US$/mt
TSI Premium JM25 Hard Coking Coal CFR China US$/mt
$110
$105
Jan-Jan-Source: Platts, The Steel Index
TSI Premium Hard Coking Coal FOB Australia US$/mt Platts PLV FOB Australian US$/mt
Source: Platts, The Steel Index
TSI Premium JM25 Hard Coking Coal CFR China US$/mt
Source: Platts, The Steel Index
Spread Liniul no.4 US$/mt - TSI CFR China US$/mt Liniul no.4 ex-Vat CFR China US$/mt
TSI JM25 CFR China Premium Coking Coal US$/mt
Spread Liniul no.4 US$/mt - TSI CFR China US$/mt Liniul no.4 ex-Vat CFR China US$/mt
TSI JM25 CFR China Premium Coking Coal US$/mt
Source: Mysteel, The Steel Index
Spread Liniul no.4 US$/mt - TSI CFR China US$/mt Liniul no.4 ex-Vat CFR China US$/mt
Source: Mysteel, The Steel Index
TSI JM25 CFR China Premium Coking Coal US$/mt
Source: Mysteel, The Steel Index
DCE 1mth - Yinchuan Coking Coal China 2nd Grade Coke Spot Price
China Prime Coking Coal Yinchuan Price DCE 1st Mth Contract
DCE 1mth - Yinchuan Coking Coal China 2nd Grade Coke Spot Price
Source: Bloomberg, DCE
$145
$140
$135
$130
$125
$120
$115
$110
$105
$100
$40
$40
$40
$20
$20
$20
$0
$200
$200
$200
$150
$150
$150
$100
¥50
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¥0
¥0
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-¥100
¥0
-¥100
-¥150
-¥50
-¥150
-¥200
¥2,000
¥2,000
¥1,500
¥1,000
¥1,500
¥1,000
¥2,000
¥1,500
¥1,000
¥500
¥500
¥0
¥500
250
250
200
DCE 1mth - Yinchuan Coking Coal China 2nd Grade Coke Spot Price
-¥100
-¥150
Global Leader in Dry Bulk Derivatives www.freightinvestor.com
200
150
250
150
100
200
100
50
0
14
Feb-14
Mar-14
Apr-14
May-14
Jul-14
Aug-14
Sep-14
Oct-14
Nov-14
Jan-15
Feb-15
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Q2-16
Cal15
Jan-14
Mar-14
May-14
Jul-14
Sep-14
Nov-14
Mar-13
May-13
Jul-13
Sep-13
Nov-13
Jan-14
Mar-14
May-14
Jul-14
Sep-14
Nov-14
China Prime Coking Coal Yinchuan Price DCE 1st Mth Contract
Source: Bloomberg, DCE
$100
$0
$100
-¥200
¥0
Spot History Forward Curve
50
14
Feb-14
Mar-14
Apr-14
May-14
Jul-14
Aug-14
Sep-14
Oct-14
Nov-14
Jan-15
Feb-15
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Q2-16
Cal15
Jan-14
Mar-14
May-14
Jul-14
Sep-14
Nov-14
Mar-13
May-13
Jul-13
Sep-13
Nov-13
Jan-14
Mar-14
May-14
Jul-14
Sep-14
Nov-14
China Prime Coking Coal Yinchuan Price DCE 1st Mth Contract
Source: Bloomberg, DCE
$100
$0
$100
-¥200
¥0
Spot History Forward Curve
150
14
Feb-14
Mar-14
Apr-14
May-14
Jul-14
Aug-14
Sep-14
Oct-14
Nov-14
Jan-15
Feb-15
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Q2-16
Cal15
Jan-14
Mar-14
May-14
Jul-14
Sep-14
Nov-14
Mar-13
May-13
Jul-13
Sep-13
Nov-13
Jan-14
Mar-14
May-14
Jul-14
Sep-14
Nov-14
Coking Coal Spot History and Forward Curves
China Domestic CC - CFR China CC Cash Arb
China Domestic Carbon Prices and Futures

2. Mar-May-Jul-TSI JM25 CFR China Premium Coking Coal US$/mt
Jan-Source: Mysteel, The Steel Index
Sep-Nov-Spread Liniul no.4 US$/mt - TSI CFR China US$/mt Liniul no.4 ex-Vat CFR China US$/mt
TSI JM25 CFR China Premium Coking Coal US$/mt
Source: Mysteel, The Steel Index
DCE 1mth - Yinchuan Coking Coal China 2nd Grade Coke Spot Price
China Prime Coking Coal Yinchuan Price DCE 1st Mth Contract
DCE 1mth - Yinchuan Coking Coal China 2nd Grade Coke Spot Price
China Prime Coking Coal Yinchuan Price DCE 1st Mth Contract
13
Source: Bloomberg, DCE
CME Platts PLV FOB Australia SGX TSI PHCC CFR China
13
Source: CME, SGX
CME Platts PLV FOB Australia SGX TSI PHCC CFR China
Source: CME, SGX
CME Platts PLV FOB Australia SGX TSI CFR China
CME Platts PLV FOB Australia SGX TSI CFR China
For more information please contact:
Edward Hutton
+44 (0) 207 090 1120
Jarek Mlodziejewski
+65 6535 5189
Lina Liu (中文报告)
+44 (0) 207 090 1120
research@freightinvestor.com
@freightinvestor
www.linkedin.com/company/
freight-investor-services
COMMENTARY
¥2,000
¥1,500
¥1,000
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¥1,500
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¥1,000
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FORWARD CURVES AND MARKET DATA
OO Open interest in the CME Platts PLV FOB Australia contract
largely focused in the front months with total open interest
holding steady at around 1 million tonnes, dropping slightly
as participants close positions and take some profit just as
the financial year comes to a close.
OO 74,000 tonnes traded in total last week across all contracts
with the majority of volume to be found in the near month
and 2nd Half Cal15 PLV FOB Australia contracts. This
is a slight increase to the week before, where we saw
54,000tonnes of CME coking coal contracts being traded.
OO I n other news, Indian merchant coke manufacturers are
asking for a rise in the import duty for met coke, as they
allege dumping from Chinese producers, this could restrict
accessible markets for Chinese producers, focusing on
other markets, such as Japan and Korea.
Source: Bloomberg, DCE
250
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150
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100
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50
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¥50
¥0
¥50
-¥50
¥0
-¥100
-¥50
-¥100
-¥150
Global Leader in Dry Bulk Derivatives www.freightinvestor.com
FISTML02
Source: CME, SGX
150
200
¥0
0
01-Oct
08-Oct
15-Oct
22-Oct
29-Oct
05-Nov
12-Nov
19-Nov
26-Nov
03-Dec
0
Dec-14
Jan-15
Feb-15
Mar-15
Apr-15
May-15
Jun-15
Jul-15
Aug-15
Sep-15
Oct-15
Nov-15
Dec-15
Jan-16
Feb-16
Mar-16
Apr-16
May-16
Jun-16
Jul-16
Aug-16
Sep-16
Oct-16
Nov-16
Dec-16
Mar-May-13
Jul-13
Sep-13
Nov-13
Jan-14
Mar-14
May-14
Jul-14
Sep-14
Nov-14
Source: CME, SGX
-¥200
¥0
0
01-Oct
08-Oct
15-Oct
22-Oct
29-Oct
05-Nov
12-Nov
19-Nov
26-Nov
03-Dec
0
Dec-14
Jan-15
Feb-15
Mar-15
Apr-15
May-15
Jun-15
Jul-15
Aug-15
Sep-15
Oct-15
Nov-15
Dec-15
Jan-16
Feb-16
Mar-16
Apr-16
May-16
Jun-16
Jul-16
Aug-16
Sep-16
Oct-16
Nov-16
Dec-16
Mar-May-13
Jul-13
Sep-13
Nov-13
Jan-14
Mar-14
May-14
Jul-14
Sep-14
Nov-14
Open Interest (‘000/mt)
Traded Volume (‘000/mt)
Market Update: 10th December 2014