Strong demand for imported fuel grade petroleum coke (petcoke) was being seen in India, but higher landed costs were making buyers wary of concluding deals, sources said this week.
A north India-based trader source said demand was “very healthy”, going by the number of enquiries.
“Despite the monsoon season, petcoke demand has picked up this time compared with last year,” he said.
While offer prices for Supramax shipments of US Gulf petcoke having 6.5% sulfur were in the high-$70s/mt CFR, trades could only happen at around $76-$77/mt CFR, this trader said.
Sources said that recently a few petcoke shipments had been reportedly sold to Indian buyers for delivery on the west coast of India and for June-July loading at around $77/mt CFR, but Platts could not verify these deals.
A south India-based trader said tighter supply and higher dry bulk freight rates from US Gulf to India were pushing up landed costs for petcoke cargoes.
Freight rates for Supramax vessels from USGC to India were estimated to be at around $26.50/mt to $27/mt, up almost $1 from last week, according to market sources.
The south India-based trader said he had offered Panamax shipments of US petcoke with 6.5% sulfur at around $73.50-$74/mt CFR east coast India.
He too said there was decent demand for fuel grade petcoke in India and more deals could happen if freight rates fell.
A leading cement company was currently in the market seeking three shipments of US petcoke for delivery to the east coast of India, sources said. An executive of a north India-based cement company said he was actively pursuing a June-loading petcoke shipment. He said while offer prices were at around $76-$77/mt CFR, his target price was at around $72-$73/mt CFR.
Another end-user source from southern India said he was also offered a shipment of US petcoke with 6.5% sulfur at around $80/mt CFR but did not take up the offer.
SAUDI PETCOKE
Sources said Indian demand had strengthened for Saudi Arabian petcoke with sulfur above 8% as such cargoes were comparatively cheaper than US material.
Some cement companies had already replaced US petcoke with Saudi material, they said.
A cement company had recently bought a few Saudi petcoke shipments from Saudi Aramco Total Refining and Petrochemical Company (SATORP) in Jubail at around $66-$66.50/mt CFR west coast.
According to a north India-based end-user source, it made economic sense to buy Saudi petcoke because of its lower price.
He said Indian buyers were seeking a discount of around $10/mt to US petcoke prices for Saudi material and “$66/mt CFR is a fair price.”
However, the first India-based trader said Saudi refineries were not willing to sell at such low prices and were offering these cargoes at around $68-$69/mt CFR.
The cement company’s executive said he was also looking for Saudi petcoke shipments because it was cheaper and he would not mind the high sulfur as his plant could use sulfur above 8%.
Platts assessed the weekly 30-60 day prices of fuel-grade petroleum coke with 6.5% sulfur at $76.75/mt CFR India East and $75.75/mt CFR India West, both up $1 from last week.
Source: Platts
