On this week's S&P Global Commodity Insights' Market Movers Asia with Sampad Nandy: China-based independent refiners are shying away from buying Far East Russian sweet crudes. (00:17)
Other highlights from Asia's commodity markets:
*Eyes on S&P Global's Asian Refining and Petrochemicals Summit (00:58)
*Buyers defer bunker fuel requirements amid sharp rise in prices (01:16)
*Commodity markets will watch out for data on China's key economic indicators (01:42)
*India is emerging as a key wheat exporter (02:12)
*Asian coal prices are likely to remain bullish (02:56)
This week: Commodity markets will watch out for data on China's key economic indicators, Asian coal prices are expected to remain bullish as buyers look for alternatives to Russian coal, and India's wheat export prices are in focus as Black Sea wheat supplies remain uncertain.
But first, in oil, price differentials for Far East Russian sweet crudes are likely to extend the recent sharp decline. Major China-based customers are shying away from spot ESPO and Sokol crude sales, with independent refineries in Shandong under pressure to cut run rates.
Many South Korean, Indian, Japanese and Southeast Asian refiners are reluctant to pick up spot Russian crude cargoes due to sweeping financial sanctions on Moscow. Trade participants in Asia had initially anticipated China-based traders to actively pick up the unwanted Russian sweet crude cargoes. However, traders have said that Chinese refineries have their own margins to consider before buying spot cargoes.
Meanwhile, S&P Global Commodity Insights will be organizing the Asian Refining and Petrochemicals Summit on March 15-16. The challenges posed by crude surging above 100 dollars a barrel and the impact of the Russia-Ukraine conflict on regional oil product trade flows will be some of the themes at the summit.
Moving to the bunker fuel market, market participants are tracking the dramatic rise in marine fuel prices -- a manifestation of soaring international crude oil prices. Both bunker buyers and suppliers have turned cautious, with end-buyers likely to defer bunker fuel requirements. The industry is laying more emphasis on counterparty risks as credit tightens following the sanctions. Many suppliers worldwide have also turned their backs on Russian businesses and oil products.
Moving on, markets will keenly await the release of China data March 15 that will be an important indicator of future demand from Asia's top consumer. Data on fixed asset investment, crude oil output, throughput, crude steel production and electricity consumption will be released this week.
Market participants expect that crude steel output in January-February could see an increase from December levels, while property new home starts and infrastructure investment may be weaker than expected.
In agriculture, grain markets will be closely watching Indian wheat export prices. The US Department of Agriculture has raised India's wheat export forecast for marketing year 2021-22 to 8.5 million metric tons. India has emerged as a key exporter after Black Sea wheat outflows came to a halt after the invasion.
That brings us to our social media question for the week: Will India be able to expand its wheat trade amid absent Black Sea supplies? Share your thoughts on Twitter and LinkedIn.
In the vegetable oil market, top buyer India is set to report monthly import numbers this week. All eyes will be on how the price sensitive market is dealing with sky-high prices of palm and soybean oils and disruption in sunflower oil supplies due to the Russian invasion.
And finally, in coal, Indonesian thermal coal prices may continue to extend gains this week as buyers look for alternatives to Russian coal. Supply remains tight as buyers from Europe join regular Asian buyers seeking prompt cargoes. Prices of Australian high-ash coal are also expected to remain bullish on the back of strong demand from east Asian buyers.
Thanks for kicking off your Monday with us. Have a great week ahead!