Coal news and updates

The situation has resulted in prices of low-calorific value (CV) Indonesian coal rising above higher-CV Australian material, an unprecedented situation that will likely cause problems for Chinese buyers during the summer months when air-conditioning rises sharply and pushes up power demand. The situation is also fuelling concerns among Chinese consumers of a potential looming supply crunch, after tight coal supplies last winter resulted in electricity rationing.

 

Prices of Indonesian GAR 4,200 kcal/kg (NAR 3,800 kcal/kg) coal were last assessed by Argus at a 10-year high of $55.98/t fob Kalimantan on 14 May. This was up by $2.18/t on the week and around 25pc higher than at the start of the year, with the increase largely driven by strong Chinese demand. In contrast, higher quality Australian NAR 5,500 kcal/kg prices were assessed on the same day at $55.36/t fob Newcastle, up by just 14¢/t on the week, with declining demand from India on a severe Covid-19 outbreak weighing on demand.

 

India has become a crucial market for Australian coal after China, the world's largest coal importer, last year imposed an informal ban on Australian imports following calls by Canberra for an investigation into the origins of Covid-19. China earlier this month suspended its main economic talks with Australia, indicating that there is unlikely to be an easing of the ban anytime soon.

 

 

Source : https://www.argusmedia.com/en/news