Nearly 10 days gone by after the settlement of Q4 contract between Nippon Steel and BMA at USD 170 per tonne the European mills are still mulling on the core issue of quarterly or monthly settlement.

Understandably the sulking European steel mills yet to cry freedom from the recessionary girdle are not keen on accumulating volumes at higher levels when the spot levels remain at USD 150-155 per tonne.

As the year draws to close mills are eager to show healthy balance sheets in a beleaguered year were nothing has gone right. Moreover with cheaper and abundant coke available from the USA the settlement at USD 170 per tonne has become prime mover to go for spot booking.

Dry summer has helped maintain supplies despite BMA strike. Acceptability of USD 170 per tonne was always questionable despite miners maintaining availability of prime quality coking coal will keep the prices afloat. However in the given market scenario European mills are not averse to blending it with low quality US coal.

Q1 2013 remains sketchy with talks of improved levels going around with recent spurt in Chinese steel prices and iron ore levels. US economy is showing tendency of resilience after QE3.

Source - Strategic Research Institute

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