Strong buyer interest bolstered the US Gulf Coast petcoke markets this week as both Chinese and Indian demand put a strain on available supply.
Buyers were seeking, but many were not successful locating high-sulfur cargoes as many refineries had nothing to sell.
"It's nice to have this change in the market -- to have people calling me again -- it's exciting," one USGC trader said.
The trader was optimistic that interest would remain strong throughout the end of the year as both Jubail and Yanbu refineries in Saudi Arabia were sold out of high-sulfur petcoke through summer and the Reliance gasifier project in India was slated to create extra demand.
Additionally, expected higher freight rates along with a steep discount to imported South African coal continued to push Asian demand.
"I think what's pushing it is Indian demand," the trader said. "With the Reliance gasifier project adding to it, that creates more urgency for this year."
The trader said cargoes were available, but refiners did not want to sell at $24/mt as they were anticipating prices to go higher.
A North American cement buyer also confirmed hearing bids at $23-$24/mt, but no cargoes were sold at that level, he said.
A second USGC trader also reported increased Chinese interest as a widely expected ban on mid-and-high sulfur petcoke has not taken place.
"There haven't been any restrictions officially announced so some people are more comfortable taking cargoes," the source said.
Platts assessed greater than 6% sulfur petcoke out of the USGC at $24-$26/mt FOB, up $2 on each end, and assessed 5%-6% sulfur petcoke at $26-$27/mt, up $2 on the lower end and $1 on the upper end.
Mid-sulfur petcoke supply also came under increased pressure as two Venezuelan loading terminals - Petro San Felix and Petrocedeno - were reportedly down for maintenance issues, sources said.
But weak European demand has kept mid-sulfur petcoke prices from rising, leaving little disparity among the different qualities.
The unreliability of Venezuelan loading terminals will likely begin to shift more demand to USGC refiners, the first USGC trader said, noting that mid-sulfur prices will begin to go up as Turkish inventories are depleted.
"Buyers that need and depend on this quality of petcoke are not going to rely on Venezuela to start operating in the time they say it will," he said. "They will start buying from the USGC at some point."
A third USGC trader reported a Chinese customer had purchased a cargo of 4.5% sulfur petcoke at $48/mt CFR China. Freight cost $18/mt for the cargo, which left an FOB price of $26-$27/mt, the trader said.
Another deal was reported by a USGC refining source at $27/mt FOB. Other deals were reported last week at $29 and $30/mt, although the higher priced cargo carried a premium, sources said.
"It sounds to me like mid-sulfur and high-sulfur are right on top of each other," the refining source said. "Customers are telling us repeatedly that if there's any price difference, they'll take the high sulfur."
Platts assessed 4%-5% sulfur petcoke at $27-$30/mt FOB, up $1 on the lower end, and assessed Venezuelan petcoke at $27-$29/mt FOB, up $1 on each end.
In the US West Coast markets, P66's Rodeo refinery sold a cargo in the mid-$80s FOB for a 25,000 mt cargo with 1.5% sulfur petcoke loading in April. The cargo was reportedly sold into the anode grade market.
Another cargo was sold from Canada's West Coast at $34/mt FOB for a 65,000 mt, high-sulfur petcoke cargo headed for China. Canada's cargoes carry a $1-$2 premium over California cargoes due to higher loading sizes along with the shorter destination to Asia, the US trader source said.
Platts assessed USWC greater than 2.5% sulfur petcoke at $36-$52/mt, and assessed less than 2.5% sulfur petcoke at $75-$80/mt. Both assessments were unchanged on the week.
