Japan steelmakers scramble for coking coal to make up Debbie losses
By Yuka Obayashi and Aaron Sheldrick
TOKYO, April 21 (Reuters) - Japanese steelmakers have bought coking coal from the United States, Canada and China to replace supply lost after a cyclone closed rail links in Australia, their biggest supplier, industry and trader sources said.
Still, the Japanese buyers are paying nearly double the $150 a tonnes price that they were discussing with sellers for second-quarter supply before the supply disruption. The supply talks are now on hold and prices will likely stay high until full volumes start flowing again.
In 2016, Japan bought about 71 percent of the 59.9 million tonnes of coking coal it consumed from Australia.
"We've tapped supplies by bringing forward shipping schedules of cargos from Canada and the United States, and buying some extra coal from China," an official at a major Japanese steelmaker who deals with raw material procurement told Reuters.
The emergency supplies were purchased at about $300 a tonne, said the official and a second source a major producer.
Premium coking coal prices from the east coast of Australia were quoted at $289.50 a tonne on Thursday, down from $314 a week earlier, but still more than 90 percent above levels four weeks ago, according to Platts TSI.
About 300,000 tonnes of coking coal from the U.S. is steaming for Japanese ports on bulk carriers, while dozens of empty ships sit offshore ports in Queensland awaiting loading, according to Reuters Eikon Data.
Buyers have also tapped supplies from Russia, according to a source at a major Japanese trading house. Continued...