Log in
Forgot password ?
Become a member for free
Sign up
Sign up
Dynamic quotes 

4-Traders Homepage  >  Equities  >  Tokyo  >  Nippon Steel & Sumitomo Metal Corp    5401   JP3381000003

News SummaryMost relevantAll newsSector newsTweets

Nippon Steel & Sumitomo Metal : Japan steelmakers scramble for coking coal to make up Debbie losses

share with twitter share with LinkedIn share with facebook
share via e-mail
04/21/2017 | 12:46pm CET
FILE PHOTO: Coal sits at the Hay Point and Dalrymple Bay Coal Terminals that receive coal along the Goonyella rail system in Australia

Japanese steelmakers have bought coking coal from the United States, Canada and China to replace supply lost after a cyclone closed rail links in Australia, their biggest supplier, industry and trader sources said.

Still, the Japanese buyers are paying nearly double the $150 a tonnes price that they were discussing with sellers for second-quarter supply before the supply disruption. The supply talks are now on hold and prices will likely stay high until full volumes start flowing again.

In 2016, Japan bought about 71 percent of the 59.9 million tonnes of coking coal it consumed from Australia.

"We've tapped supplies by bringing forward shipping schedules of cargos from Canada and the United States, and buying some extra coal from China," an official at a major Japanese steelmaker who deals with raw material procurement told Reuters.

The emergency supplies were purchased at about $300 a tonne, said the official and a second source a major producer.

Premium coking coal prices from the east coast of Australia were quoted at $289.50 a tonne on Thursday, down from $314 a week earlier, but still more than 90 percent above levels four weeks ago, according to Platts TSI.

About 300,000 tonnes of coking coal from the U.S. is steaming for Japanese ports on bulk carriers, while dozens of empty ships sit offshore ports in Queensland awaiting loading, according to Reuters Eikon Data.

Buyers have also tapped supplies from Russia, according to a source at a major Japanese trading house.

Australian rail operator Aurizon Holdings Ltd (>> Aurizon Holdings Ltd) temporarily closed four of its coal lines the Bowen Basin in the state of Queensland, which produces about 50 percent of global coking coal, after Cyclone Debbie made landfall on March 28.

Three of the rail lines hit by floodwaters and landslides have reopened already and Goonyella, largest in terms of export tonnage, is expected to open on April 26 - about 10 days ahead of schedule.

Still, Aurizon said on Tuesday that the Goonyella line will be operating at a reduced level with trains moving at lower speeds for an undetermined amount of time.

"The Goonyella situation is going to keep the spot price up. The coal coming off that line is pretty much the basis for the spot price," said Peter O'Connor, an analyst at Australian investment firm Shaw and Partners.

"It'll be important to keep an eye on when Aurizon finally gets the line back to full operating levels. No one knows that yet," he said, a sentiment echoed by the producer source.

BHP Billiton (>> BHP Billiton plc) (>> BHP Billiton Limited), the world's biggest coking coal shipper, was among five miners in the region to declare force majeure, a clause typically invoked after natural disasters when companies cannot meet supply commitments.

Japan's steelmakers were already running down inventories of coking coal prior to the current supply disruptions.

"You did see Japanese steelmakers ... actually run down their stocks quite considerably," said Paul Flynn, the chief executive officer for Australia's Whitehaven Coal Ltd on an earnings call last week, adding there would be a "lingering impact on ... coal sales for some time."

The price talks for the second-quarter coking coal term contracts may restart next month, said the source from Japanese steelmaker source.

For graphic on cyclone-hit coal rail line click on http://tmsnrt.rs/2osg5Dr

For graphic on Japan's coking coal imports click on http://tmsnrt.rs/2p2quVR

(Additional reporting by Jim Regan and Jonathan Barrett in SYDNEY; Editing by Christian Schmollinger)

By Yuka Obayashi and Aaron Sheldrick

share with twitter share with LinkedIn share with facebook
share via e-mail
01/19 NIPPON STEEL & SUMITOMO METAL : "Hot-Rolled Steel Sheet and Manufacturing Method..
01/18 EXCLUSIVE : Japan in driver's seat for Indian bullet train deals
01/15 NIPPON STEEL & SUMITOMO METAL : Transfer of Shares of Ring Techs Co., Ltd. to To..
01/11 NIPPON STEEL & SUMITOMO METAL : "Hot-Rolled Steel Sheet and Manufacturing Method..
01/05 Japanese companies begin to buckle as Abe pressures them to raise wages
01/04 NIPPON STEEL & SUMITOMO METAL : New Safety Engineering Data Have Been Reported b..
2017 NIPPON STEEL & SUMITOMO METAL : Notice Regarding Merger (Simplified Merger) with..
2017 NIPPON STEEL & SUMITOMO METAL : Researchers Submit Patent Application, "Hot-Roll..
2017 NIPPON STEEL & SUMITOMO METAL : Patent Application Titled "T-Shaped Joint Struct..
2017 NIPPON STEEL & SUMITOMO METAL : "Structural Member" in Patent Application Approv..
More news
News from SeekingAlpha
2017 Nippon Steel & Sumitomo Metal Corp ADR 2017 Q2 - Results - Earnings Call Slid..
2017 Nippon Steel & Sumitomo Metal Corp ADR reports 1H results
2017 Nippon Steel & Sumitomo Metal Corp ADR reports FQ3 results
2016 The Ruble, Coking Coal And Mechel Valuations
2016 Have Bulk Commodities Peaked? Iron Ore Prices Make It Seem That Way
Financials ( JPY)
Sales 2018 5 579 B
EBIT 2018 -
Net income 2018 200 B
Debt 2018 2 014 B
Yield 2018 2,17%
P/E ratio 2018 12,84
P/E ratio 2019 11,18
EV / Sales 2018 0,86x
EV / Sales 2019 0,84x
Capitalization 2 771 B
Duration : Period :
Nippon Steel & Sumitomo Me Technical Analysis Chart | 5401 | JP3381000003 | 4-Traders
Technical analysis trends NIPPON STEEL & SUMITOMO ME
Short TermMid-TermLong Term
Income Statement Evolution
Mean consensus OUTPERFORM
Number of Analysts 15
Average target price 3 174  JPY
Spread / Average Target 8,9%
EPS Revisions
Kosei Shindo President & Representative Director
Shoji Muneoka Chairman
Toshiharu Sakae Representative Director, VP & Head-Finance
Shinji Fujino Representative Director, VP & Head-Technology
Soichiro Sakuma Representative Director, VP & Head-Legal Affairs
Sector and Competitors
1st jan.Capitalization (M$)
POSCO--.--%31 527
NUCOR8.93%21 847