- Weak demand, monsoon-led disruptions impact trade
- Inventories at power plants remain sufficient overall
Indian portside prices of Indonesian thermal coal fell w-o-w as the segment continued to experience bearish conditions, weighed down by persistently weak demand, increasing domestic coal availability, and a rising number of vessel arrivals.
As per BigMint’s assessment on 23 May 2025, prices of 5000 GAR coal at Kandla port fell by INR 50/tonne (t) to INR 7,750/t. The 4200 GAR grade experienced a more pronounced decline of INR 100/t w-o-w to INR 6,100/t at Kandla and INR 6,000/t at Vizag. The 3400 GAR grade registered a marginal reduction of INR 50/t to INR 4,500/t at Navlakhi.
Market sentiment remained subdued, further impacted by seasonal factors such as the monsoon-induced closure of minor ports and rainfall along the west coast of India (WCI).
Limited demand prompts price declines at major ports
Demand for Indonesian thermal coal remained limited this week and was primarily driven by short-term, sector-specific requirements. No significant procurement activity was observed, reflecting ongoing caution among buyers. As a result, prices of various grades of coal declined across major Indian ports.
Coal inventories at Indian ports, power plants decline
Thermal coal inventories at Indian ports declined by 2.2% to 14.62 million tonnes (mnt) in week 20 of CY’25, compared to 14.95 mnt in the previous week.
Coal stocks at power plants also witnessed a marginal decline during the same period. As of 21 May, total coal inventory stood at 57.403 mnt, down slightly from 57.439 mnt a week earlier. This level of stock is sufficient to meet approximately 19 days of consumption under normal operating conditions.
However, concerns persist over critically low inventory levels at several power facilities, including nine dependent on domestic coal, eight reliant on imported coal, and three utilising washery rejects.
Indonesian indexed prices show divergent trends
Indonesian thermal coal prices posted mixed declines across different calorific values, driven by fluctuating demand and cost-driven purchasing behavior in key international markets. The high-grade 5800 GAR coal slipped by $0.73/t to $77.19/t, reflecting softened interest in higher-energy coal, possibly due to tighter import budgets and subdued industrial activity.
The 4200 GAR grade saw a larger decline of $1.18/t to $47.46/t, while the lower-grade 3400 GAR dropped by $0.44/t to $33.41/t. These broader reductions suggest a cautious global buying sentiment, with consumers possibly favoring lower-cost, lower-grade options amid ongoing economic uncertainties and shifting energy transition policies.
Outlook
The outlook for the portside Indonesian thermal coal market remains subdued, with bearish conditions likely to continue unless there is a notable rise in demand or a cut in domestic coal supply. Market participants are closely tracking inventory levels and global price trends for short-term procurement decisions.
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