Indonesian coal prices may get support from Indian demand in coming weeks as prices have been falling lower enough for buyers to start looking for cargoes, traders said.
Prices for Indonesian coal have been softening in the past weeks as Chinese buyers haven’t been buying as they’re already in shoulder season, a regional trader said.
China has also revealed a plan to cut coal consumption, shut ageing steel and coke capacity in the coming three years, as part of a wider policy to cut pollution in 2018 to 2020, Reuters reported in July.
Indian buyers too have been on the sidelines, waiting for international prices to fall, the source said.
“They hope to buy at the bottom of the market,” the trader said. Depreciation of rupee has also weakened India’s purchasing power, he said.
Indonesian coal prices with heating value 4200 GAR is offered at between USD 37-39/MT, FoB vessel from Kalimantan, down from USD 40/MT level in mid-August.
But an Indian trader said Indian buyers are starting to book cargoes for October delivery because Indonesian prices have fallen lower enough for them.
“We’re seeing Indian demand has started to rise,” said the Indian trader. “Prices will be creeping up in coming months,” he said.
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