Coal news and updates

RIL cuts February loading pet coke prices by Rs 100/ton

January 05: After rolling over prices in January, Reliance Industries Ltd (RIL), India’s largest pet coke producer, has reduced the prices of the material for loading in February by Rs 100 per ton, industry sources said.

The new price is Rs 6250 per ton.

RIL had kept unchanged the price of its pet coke for loading in January at December 2014 level of Rs 6350 per ton.

In December, the company has reduced the price by Rs 100 per ton compared to November.

The reduction in price for February loading was on expected line and was largely attributed to softness in international prices coupled with average domestic demand.

A US refiner had early this week sold one cargo of mid-sulphur pet coke at $60.00 per ton FOB Houston for loading in March even as deals were being finalised at about $59 per ton FOB US Gulf elsewhere for pet coke basis 7500 Kcal/kg NAR, sulphur of 4.8% to 4.9% (ADB).

Indian consumers said imported pet coke of high sulphur (above 6%) was being offered at about $78 per ton CFR India and going by this it was expected that RIL would reduce the prices by even higher margin.

“The company should have reduced the prices of domestic pet coke considering the softness in international pet coke prices, which was traded at about $78 per ton CIF India as against $87 per ton CIF India towards end of December,” an official of a cement company said.

“Overall, demand and supply situation of pet coke in India remained unchanged and in order to better serve its customers, RIL has resorted not to reduce the price for January loading,” said another source.

The company had started reducing prices in June as it implemented a reduction of Rs 100 per ton in each of months of July, August and September.

The ex-refinery price for bulk buyers for loading in December was fixed at Rs 6350 per ton as compared to Rs 6450 per ton each in November and October, Rs 6350 per ton in September, Rs 6450 per ton in August, Rs 6550 per ton in July, Rs 6650 per ton in June and Rs 6750 per ton in May.

Though information from other refiners like Essar, HPCL and BORL who generally follow RIL in fixing their pet coke price is not available at present, they are also likely to follow the leader so far as fixing February 2015 loading prices is concerned, sources feel.

The increase in prices in October was largely due to anticipation of higher demand from cement makers who expected a higher demand for cement post monsoon and also because of slight firmness to the extent of $1-3 per ton in imported pet coke prices, they said.

However, the current economic situation in India does not provide any indication of an improvement in demand-supply situation from main pet coke consuming sector, an official of a leading cement company said.

The current price of imported pet coke is around $76-78 per ton CFR India, down by nearly $16.00 per ton from December levels of $92-93 and down from $98.00 per ton in June. The price at the end of August 2014 was quoted at $92-93 per ton CFR.