Coal news and updates

Panamax coal freight rates in the Pacific held stable Thursday in a market that was quiet but continued to be weighed down by bearish market sentiments. 

 

Indonesia's impending ban on exports of some raw materials such as bauxite and nickel ore has been pressuring Supramax freight rates over the past few weeks. Market participants expected this decline to pressure Panamax freight rates in its wake. PANAMAX RATES HOLD IN QUIET MARKET

 

Platts assessed the Panamax coal freight rates from South Africa's Richards Bay coal terminal to Paradip port on India's east coast at $17.90/mt and to Mundra on the west coast of India at $17.50/mt Friday, unchanged from Tuesday.

 

Also assessed was the Panamax coal freight rate from Indonesia's Banjarmasin port in South Kalimantan to Paradip at $10.40/mt and to Mundra at $11.90/mt, also both unchanged from Tuesday.

 

Panamax freight rates continued to find support in grain export shipments from South America, an India-based shipbroker said. 

 

Panamax freight rates were also finding support from the tight tonnage situation persisting in Capesize vessels in the Atlantic. That situation has been created because of fewer vessels seen ballasting there given the uptick in fixture activity seen out of West Australia over the past several weeks. 

 

"Panamax is still firm this week," he said. "It is the Supramax rates that are falling," he said. 

 

Market participants were braced for a quiet start to the new year but expected Indian coal demand, and hence Panamax freight rates, to trend up thereafter. 

 

"January is a busy month for Indian coal buyers," the India-based shipbroker said. "There will be an increase in coal cargo imports next month. We need to keep a close watch on Panamax rates," he said. SUPRAMAX RATES TUMBLE AHEAD OF INDONESIAN BAN

 

Indonesia's imminent ban on exports of raw materials such as nickel ore and bauxite has sent Supramax rates spiralling downward by about $4/mt over the past three to four weeks, market sources said.

 

Earlier this week, a Singapore-based charterer reported a bid of $11.25/mt versus an offer of $11.75/mt for Supramax shipment of thermal coal from South Kalimantan to east coast India's Krishnapatnam port.

 

Thursday, the bid had risen to $11.40/mt while the offer had trickled down to $11.50/mt, the charterer said.

 

The India-based shipbroker reckoned it was possible to conclude Supramax fixtures in the low-$11s/mt levels on this route.

 

Some market participants, however, put little stock in the decline in Supramax freight rates.

 

"We saw a similar trend last year too (on talks then of a ban from Indonesia)," a Dubai-based shipbroker said. "But Supramax rates recovered after February as many vessels went to east coast South America (for grain shipments)," he added.

 

The broker estimated the Supramax active fleet comprises 2,742 vessels.

 

 

 

Source: Platts