Indonesian Non-Coking Coal: Prices keep falling amid weak demand in APAC region

Indonesian medium calorific value thermal coal prices continue trending downwards, in large part due to their uncompetitive pricings as compared to South African coal of similar heating value, while Indonesian high-CV coal proves difficult to sell against lower offer prices from Russia.

Indonesian low-CV coal is also being traded at decreased levels, as smaller miners with prompt cargoes continue decreasing offer prices citing weak buying interest for lower rank coals considering their high moisture content.

In addition, Indonesia’s thermal coal supply is expected to outpace demand in the near term, with several major miners planning to increase production, potentially leading to lower average selling prices.

Notably, the overall import demand from the traditional Asian countries has remained subdued so far this year – due largely in part to China’s import limitation – offsetting incremental gains from emerging Asia.

According to market sources, bids for Indonesian 4,200 kcal/kg GAR, or 3,800 kcal/kg NAR thermal coals, remained lackluster in the Asia-Pacific region, barring few bids from India.

Nevertheless, India’s seaborne buying interest is expected to stay tepid until September, as buyers are heard adopting a wait-and-watch stance because they are well stocked due to their active pre-monsoon restocking in Q2 2019.

PRICE ASSESSMENTS

N.B.: All prices are in USD/MT and for delivery within 30 days by Supramax vessel class with cargo intake of 55,000 MT.