Chinese buyers remained on the sidelines as they continued to scout for thermal coal cargoes at cheaper prices with no rush to conclude deals amid huge stockpiles at ports and power companies, sources said.
Despite the lack of demand, some Indonesian miners have raised their offer prices since last week as supply gets cramped due to rains in East Kalimantan and the crackdown on illegal mining in South Kalimantan, sources said.
A Singapore-based trader said that cargoes of 4,200 kcal/kg GAR coal were being offered as high as $44-45/mt FOB this week, up nearly $3-4 since Friday.
"There is not much movement [of imported coal] to China because of the [higher] prices. [Buyers are] talking prices even lower than what were before the Lunar New Year," he added.
An Indonesia-based trader said that after the recent federal budget session in India, buyers in that country were ready to pay a bit higher prices compared with the Chinese buyers for various grades of thermal coal.
"Chinese buyers are not in a position to pinch suppliers any more. They will have to pay up more if they want to secure [Indonesian] cargoes," he said.
For 4,700 kcal/kg NAR Indonesian coal, the current purchase price of a Beijing-based utility is no higher than Yuan 410/mt, excluding the 17% VAT, on a landed basis or $65.60/mt CFR.
Current offer prices of 4,700 kcal/kg NAR Indonesian coal, however, have surged to a high of $70-71/mt CFR for April deliveries, sources said.
An India-based trader said that he could sell prompt-loading Indonesian 5,000 kcal/kg NAR coal at $72/mt CFR south China.
Indonesian 5,900 kcal/kg gross-as-received thermal coal for loading in the next 90-day period was assessed by Platts at $76.10/mt FOB, while 5,000 kcal/kg GAR Indonesian thermal coal for the same delivery period was assessed at $60.25/mt FOB, and both price assessments were stable from Monday.
Indonesian thermal coal with a calorific value of 4,200 kcal/kg GAR and for loading in the next 7-45 days was assessed at $41.50/mt FOB, and was also stable compared with Monday's assessment.
NEWCASTLE STABLE
China's domestic thermal coal market has yet to see any solid recovery despite the recent rebound in offer prices of overseas coal, market sources noted.
"We now only hope for a recovery in the second quarter of 2013," a Singapore-based Chinese trader said. "We have not booked any cargoes on the spot market since early February."
Due to the recent rise in ocean freights, offer prices of 5,500 kcal/kg NAR Australian coal have remained high at $87-88/mt CFR for April-May deliveries. Deducting the ocean freight cost of about $12/mt for mini-Capesize vessels, the FOB prices of 5,500 kcal/kg NAR Australian coal have been stable at about $75/mt since early February.
Offers for March-loading Newcastle 5,500 kcal/kg NAR cargoes with maximum ash of 23% were 50 cents weaker Tuesday at $75.50/mt FOB but went unbid. For April, Capesize-cargo offer prices were steady at $75.50/mt FOB while bids for Panamax shipments were at $74.75/mt FOB, as heard through broker Marex Spectron.
"Chinese market has turned decidedly bearish," a second Singapore-based trader said.
Platts assessed the FOB price of Newcastle thermal coal with a calorific value of 5,500 kcal/kg NAR and with typical ash of 20%, normalized from 17-23% and for loading in the next 7-45 days at $76.40/mt, and down 10 cents from the last assessment on Monday.
Platts assessed the price of 5,500 kcal/kg NAR seaborne traded thermal coal for delivery to ports in south China within the next 15-60 day period at $85.05/mt CFR, down 20 cents from Monday, and for domestic 5,500 kcal/kg NAR thermal coal at China's Qinhuangdao port the price was assessed at Yuan 530/mt, down Yuan 2 on-day.
