Rise In Coking Coal Prices, China’s Modest GDP Growth Outlook To Dampen Metal Rally: Motilal Oswal
Persistent volatility in coking coal prices hampers Indian steel makers, which rely heavily on imported coking coal.
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Motilal Oswal Report
Premium hard coking coal prices have been falling for the last two weeks, hitting a low of $364/tonne last week from the high of $402/tonne in mid-Feb-23. However, strong demand in Asia and Europe led to a sharp rise in coking coal prices last week.
Persistent volatility in coking coal prices hampers Indian steel makers, which rely heavily on imported coking coal. Usually steel manufacturers in India carry inventory of around two months, and hence any price hike would dent margins of steel manufacturers in Q1 FY24.
However, recently all major steel producers have increased the flat steel price by Rs 1,400/tonne to pass on the rise in raw material prices to end consumers.
A similar trend was also witnessed in the international market, i.e., Shagang Group, one of China’s leading steel producers, lifted its hot rolled coil price by $14.5/tonne last week.
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