Seaborne prices at China's southern ports searched for direction in thin Asia trade Monday as currency and freight issues for the most part precluded deals in the CFR South China market, said traders.
The Platts/Fenwei CFR South China (CCI 8) price for imported thermal coal was assessed at $74.90/mt basis 5,500 kcal/kg NAR, excluding Chinese VAT, down 10 cents/mt from Friday.
The China Coal Index (CCI 1) price for domestic thermal coal was assessed at Yuan 516/mt FOB Qinhuangdao inclusive of VAT, Yuan 1 higher.
"A few market factors -- China's weaker currency and firm freight -- are not helping," said one market participant.
The Chinese currency firmed Monday trade to around Yuan 6.2 to the US dollar, having been on a downward trajectory since the start of this year.
The Capesize vessel freight rate on the Newcastle, Australia to South China trade route for coal was around $15/mt, making it difficult for sellers to put together delivered-price CFR deals, said traders.
A Beijing-based trader said he was in talks with his supplier about a Capesize cargo of 5,500 kcal/kg NAR Australian coal at $74.50/mt CFR Fangcheng port for April delivery.
"The supplier gave us this good price because we paid them higher prices in the term contract," he said, referring to Capesize cargoes of 5,500 kcal/kg NAR Australian coal he booked at $84/mt CFR.
A trader in China's Shanxi province, who was offered 5,500 kcal/kg NAR Australian coal in Capesize cargoes at $76/mt CFR for delivery in April and May, said the offer price was $2/mt higher than he could pay. "It is hard for us to take the coal at prices higher than $74/mt CFR."
An April-arrival Australian high-ash cargo, most likely in the hands of a Chinese trader, was heard offered at $76.75/mt CFR South China and met with lukewarm interest from buyers, said a Singapore-based market participant.
Another market participant, broker Marex Spectron, heard a bid on a late-April arrival Australian high-ash cargo basis 5,500 kcal/kg NAR at $74.35/mt to an offer at $75.75/mt, in the Asia trading session.
May-arrival cargoes of the same specification and origin were heard bid at $75.50/mt CFR basis to offers at $76.50/mt, said the Singapore-based participant.
South African 5,500 kcal/kg NAR cargoes were effectively priced out of the CFR China market, with offers were heard for this origin and specification at $77-78/mt in Monday trade.
April-loading cargo offer prices for 5,500 kcal/kg NAR Australian thermal coal have edged up to $62.50-63/mt FOB, from about $61.50-62/mt FOB a week ago after a deal by a large Australian miner at about $63/mt FOB for a Capesize cargo of this coal.
"We cannot take such cargoes priced above $62/mt FOB," a Shandong-based trader said.
In China's domestic thermal coal market, transactions were heard around Yuan 515-520/mt FOB Qinhuangdao port, including VAT.
A number of 20,000-30,000 mt cargoes of 5,500 kcal/kg NAR domestic coal were heard traded at around Yuan 520/mt FOB Qinhuangdao port, including 17%, according to a Shanghai-based trader.
Two separate trades were heard in the Qinhuangdao spot market for Shanxi 5,500 kcal/kg NAR coal at Yuan 520/mt FOB, though there were also offers at Yuan 515/mt from traders speculating, said market sources in China.
A Jiangsu-based trader was offering 20,000 mt of 5,500 kcal/kg NAR Shanxi thermal coal at Yuan 490/mt at Nantong Port on the Changjiang River.
After the deduction of coastal freights of about Yuan 40/mt, the price of Yuan 490/mt will net back to about Yuan 450/mt FOB Qinhuangdao port, said the trader.
