Data gathered from Indian ports by Iman Resources shows that India’s imports of Petroleum Coke have contracted by 41% in June 2020 from 1.01 million metric toones (MMT) to 0.599 MMT. The contraction was even sharper sequentially at 62% compared with the import arrival of May at 1.578 MMT.
On a year to date basis (Jan-Jun) imports totaled 5.54 MMT down 18.48% from 6.81 MMT in the comparable period last year.
In June 2020 imports from all origins contracted except Oman but in the 6 month period of Jan-Jun, supplies from the US have actually grown by about 19% and for the first six months of this calendar year supplies from the US constitute about 75% of all India’s pet coke imports in 2020.
Prices of US Gulf Coast (USGC) petcoke peaked in August 2018 and were on a steady decline till the end of May 2020 at which point they have started moving up again. And supply has of petcoke has tightened both domestically and internationally in the wake of the Covid 19 pandemic and a crash in oil prices which has led to an inevitable cut in refining across all regions.
Additionally, in India, domestic petroleum coke output has been partially impacted by refiners temporarily shifting to light sweet crude from sour crude previously, as reported by Argus in a recent report. The use of low-Sulphur sweet crude is favorable for output of high-value gasoline and middle distillate products but reduces coke yields.
The switch was made to take advantage of a narrower price gap between sweet and sour crude earlier this year and the next possible change in crude might only happen after August. The situation could result in supply tightness for domestic coke over the next couple of months. The domestic availability of pet coke has declined by 10%, if not more.
The tighter domestic coke supply situation has coincided with reduced availability of seaborne coke from the US, which is India’s main source of imported coke. The resulting supply tightness has contributed to an increase in delivered India prices of US coke, which are also being supported by firmer freight rates. Argus reports that the price of US coke delivered to India was last assessed at $72/t cfr on 8 July, up from $63/t cfr on 10 June. Offers for August-loading US coke cargoes are now in the high-$70s/t.
India’s largest private-sector coke producers RIL earlier this month raised their basic sales prices for July by more than 18% from June. Other refiners have also followed this move.
This analysis has been compiled by obtaining data from Iman Resources’ sources.
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