Coal news and updates

Asia met coal market steady on cautious sentiment

The seaborne metallurgical coal market was relatively calm Monday with Chinese buyers expressing some hesitance in what they see as a mixed market.

Platts assessed Australian premium low-vol hard coking coal unchanged on FOB basis at $151/mt. However, CFR China and India prices were pushed up by 50 cents due to slightly higher freight rates. Standard-quality HCC meanwhile remained steady at $151/mt CFR China but dipped 50 cents on an FOB basis at $135/mt.

Participants generally were less confident about the market trend with easier steel prices and futures markets.
"Conditions are a bit mixed," one Shanghai-based trader said, adding that if steel prices fall further, coal prices would definitely drop.

On the sell-side, indicative offer could be heard at around $155/mt FOB for Australian mid-vol high fluidity premiums, and $167/mt CFR or higher for Australian 70-74% CSR low-vol premium coal.

One Australian mining source described the market as neutral with no significant upside or downside forces to move it either way.

But another mining source was more cautious. "The entire market condition doesn't support an uptrend," he said, similarly citing weak steel and future markets.

Indicative bids collected on Monday slipped a little to $160-165/mt CFR for Australian premiums, as one purchasing manager cut his bid by around $2/mt to only $160/mt CFR for Australian top brands, citing weak steel fundamentals.

But demand appeared to be resilient in northeast China with one end-user there still keen on Australian premium mid-vol material at $164-165/mt CFR north China equivalent.

Many Chinese sources also said that most players were not in the mood to trade with an upcoming mid-Autumn holiday Thursday and Friday.

In the paper market, coking coal futures saw a Yuan 1/mt increment to its last traded price at Yuan 1,134/mt ($185/mt) while coke futures dipped Yuan 8/mt to Yuan 1,566/mt. Both were for the most liquid January 2014 contracts.

Tangshan square billet price gained Yuan 10/mt from Friday to Yuan 3,080/mt ex-stock on Monday, but was still Yuan 70/mt lower than the price at last Monday at Yuan 3,150/mt.

With regards to the Indian market, steelmakers were said to be handling the currency volatility well since they were passing on raw materials costs to their own end-users.

For second-tier, a Shanghai-based trader heard Australian 55-60% CSR, 19-20% VM HCC being offered $148/mt CFR, which gels with most sellers' estimation for 60-63% CSR Australian coals. These trading sources were confident to achieve a sales price of around $147-149/mt CFR China.

On mid-vol PCI, there was a buy-side interest for Australian 16% VM, 11%A, 0.7% S and 60 HGI at around $120/mt CFR China. The product was previously offered at $123/mt CFR China.

Meanwhile, another Australian PCI with 18-19% VM and 10% ash was still available at $127/mt CFR China for an end-September or early October loading cargo.

Some end-users were reported to be interested in Australian Hunter Valley type semi-soft at $112-113/mt CFR China.

Source: Platts