Coal news and updates

Atlantic Thermal Coal: CIF ARA slips as market weighs Colombian strike

European-delivered CIF ARA physical thermal coal prices slipped Tuesday to a more than one-week low as traders tried to determine how a possible strike by Colombian mine mechanics could affect the country's production.

Platts assessed the price of CIF ARA thermal coal basis 6,000 kcal/kg NAR and for delivery within the next 15-60 days at $71.10/mt, down 45 cents from Monday and the lowest level since June 27.

A multi-origin 50,000-mt July DES Rotterdam shipment with US optionality traded at $70/mt via globalCOAL, 15 cents below the last July trade Friday.


A similar volume and origin August DES Amsterdam trade went through onscreen at $70.95/mt, down 65 cents from Monday. Further out, a September DES AR cargo traded onscreen at $73.75/mt with exchange of futures for physical (EFP) terms attached, unchanged from Monday.

A London-based trader said the Colombian mechanics strike, which is scheduled to start Saturday, would only be a threat if it is extended, an opinion which mirrored general market sentiment.

A Switzerland-based trader said the effects would "not be immediate" as the mining machinery would still have to break down after the strike begins for operations to be affected.

"I don't think there's any real reason to be worried at the moment. In general, I believe this is a further sign of the growing pains of Colombia," he said, referring to the recent labor disputes in the country.

The contracted mechanics strike is only expected to affect two of Colombia's largest miners, Drummond and Prodeco, sources said Monday. The trader added Russian coal shipments into the ARA region were relatively unchanged, with some fresh spot tonnages being harder to come by "at meaningful prices."

He said this was more due to the "seasonal nature" of Russian production, making it difficult to offer fresh tonnages this month, rather than to any specific fundamental reason.

A 150,000-mt Capesize coal vessel was fixed between Colombia's Puerto Bolivar to Rotterdam at $10/mt between Aug 1-5, according to a shipping source.

FOB RICHARDS BAY DROPS 20 CENTS ON-DAY

South African FOB Richards Bay prices fell Tuesday on a continued lack of Indian spot demand, market participants said.

Platts assessed the FOB price of physical Richards Bay thermal coal basis 6,000 kcal/kg NAR and for loading within the next 7-45 days at $72.10/mt, down 20 cents from Monday and at a fresh nine-month low.

Sources said Indian demand for South African coal continued to be subdued, mostly because of the monsoon season, despite the availability of all-weather ports in the country.

An Indian trader said the upcoming budget that is to be released by the new Indian government might "provide some momentum" to coal trading with the market hoping for a pro-growth budget to revive the sagging economic growth.

Broker sources said August-loading 6,000 kcal/kg NAR cargoes were bid at $71/mt FOB and offered at $72/mt, compared with o Monday's bid-offer spread of $70.50/mt-$72/mt.

Outside of Platts 7-45 day assessment window, a 50,000-mt South African origin September-loading vessel traded at $72/mt FOB with EFP terms attached via Atlantic Brokers, $2 under the last September trade on June 30 and in line with Monday's offer.

A second India-based trader said he was looking to buy a shipment of South African 5,500 kcal/kg NAR coal for end-July loading, but later shifted to "cheaper" Australian coal.

He said he might buy a shipment of South African 5,500 kcal/kg NAR in August, but only if he found the prices "competitive."

A third Indian trading source said Indian demand was muted for both Richards Bay 6,000 kcal/kg NAR and 5,500 kcal/kg NAR coal. There were a couple of inquiries from Pakistan, which his company was negotiating currently, he said.

A fourth India-based trader said he was looking to buy a shipment of 75,000 mt of South African 5,500 kcal/kg NAR coal for August but he was yet to receive any offers.

Platts assessed the FOB price of physical Richards Bay thermal coal basis 5,500 kcal/kg NAR and for loading within the next 7-45 day period at $64.60/mt, down 40 cents from Monday.

Source: Platts