Indonesian coal prices dropped for the second week as Chinese buyers have yet to return due to sufficient stockpiles, traders said.
Prices of Indonesian coal of 4200 GAR was bid at between USD 45.50/MT to USD 47/MT, down from around USD 50-51/MT early this month, two traders said.
“Prices are sliding because China has been producing during Chinese New Year. So they’re not in a rush to buy,” said Ramli Ahmad, fossil fuel speciliast with PT Kawarna Energi Corpindo in Jakarta. “Unless major markets, like Australia, have weather problems, only then price will rise.
Chinese demand is also seen slowing as weather is getting warmer with winter at its tail end, another traders said.
Current offer for 4200 GAR coal was heard at USD 48-49/MT, FoB Kalimantan, while 3800 GAR coal was offered at USD 38-39/MT, FoB Kalimantan.
Prices also fell as production in Indonesia’s coal-producing provinces in Kalimantan and Sumatra islands is likely to pick up in coming weeks as rainy season starts to dissipate.
Light rainshower is still expected expected in Kalimantan island with potential medium to heavy rains in all five provinces from March 13-15, according to weekly weather forecast from Indonesia’s state-weather agency, BMKG. But from March 16-19, wet weather is expected only in East Kalimantan, West Kalimantan and North Kalimantan, the agency said.
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