Trade Resources Industry Views Indonesian Thermal Coal Prices Were Steady Amid Reduced Production and Weak Demand

Indonesian Thermal Coal Prices Were Steady Amid Reduced Production and Weak Demand

Indonesian thermal coal prices were steady Friday amid reduced production and weak demand from China and India, sources said.

"Demand has been flat. There has been no real movement," an Indonesia-based trader said.

A Singapore-based trader said he has not seen any drop in thermal coal prices "which is a good thing", adding he had heard Indonesian miners were cutting output to combat low prices but believed it was not a general trend.

The Indonesia-based trader said one of its mines cut production of 4,200 kcal/kg GAR and has not done any deals for the grade recently.

Offer prices for Supramax cargoes of 4,200 kcal/kg GAR were at $37-37.50/mt FOB, he said, adding a Supramax cargo of blended 5,000 kcal/kg GAR for June loading was reportedly sold at $56.50/mt FOB to an Indian buyer.

He also said there has been good buying interest from India for 4,600 kcal/kg GAR, which is being offered at $48.85/mt FOB for a geared Supramax cargo loading in June.

The Singapore-based trader said a Supramax shipment of 3,800 kcal/kg GAR was being offered at $31-31.50/mt FOB, adding: "This grade has not been moving much".

An India-based trader said while a few desperate cargoes of 3,800 kcal/kg GAR have been seen offered at $30.50/mt FOB, he marked fair value for the grade at $32-33/mt FOB.

The Singapore-based trader said offer prices in India for geared Supramax cargoes of 4,200 kcal/kg GAR for June loading were at $37.50/mt FOB, while a June-loading Supramax cargo of blended 5,000 kcal/kg GAR was offered at $55/mt FOB and $56/mt FOB for a Panamax shipment. Offers of 5,800 kcal/kg GAR from top miners are priced at $75/mt FOB, he said.

A China-based trader said local buyers could pay only about $74/mt CFR south China for 5,500 kcal/kg NAR cargoes, and buyers usually preferred Australian coal to Indonesian material.

With the Indian election coming to a close this week, the Singapore-based trader said he expected demand there to improve in the medium to long term.

"Change will not happen overnight," he said, adding it will take time for the new government to settle down and any policy changes would take effect after about six months.

Another Singapore-based trader said he was offering a June-loading cargo of 4,200 kcal/kg GAR at $37.25/mt FOB for geared Supramax cargoes and $38.75/mt FOB for gearless Panamax parcels.

Meanwhile, a second China-based trader said domestic demand remained slow mainly because stocks at ports are high and utilities do not have a purchase plan for May and June.

Indonesian 5,500 kcal/kg NAR coal is not competitive enough in China as it is offered at $67-68/mt FOB, he said, while Chinese utilities' buying price is $72/mt CFR. He placed the Panamax freight rates from Indonesia to south China at $7/mt.

"It is hard to sell imported cargoes in China because of the more competitive price of domestic material," he said.

The offer price for 3,800 kcal/kg NAR -- or 4,200 kcal/kg GAR -- coal was about $38/mt FOB, while bids were at $37/mt FOB, he said.

Platts assessed the price of FOB Kalimantan 4,200 kcal/kg GAR coal at $37.35/mt, unchanged from Thursday, with FOB Kalimantan 3,800 kcal/kg GAR at $31.45/mt, down 5 cents.

Platts assessed the daily 90-day prices for FOB Kalimantan 5,000 kcal/kg GAR coal at $55.75/mt, up 10 cents, while FOB Kalimantan 5,900 kcal/kg GAR coal fell 15 cents to $67/mt.

Source: http://news.chemnet.com/Chemical-News/detail-2314082.html
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Indonesian Thermal Coal Prices Steady on Flat Demand From China, India
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