The South African Richards Bay FOB physical thermal coal
market traded twice on a fixed price basis Tuesday, with market sources attributing
the renewed interest from Indian buyers.
A 50,000 mt March-loading deal traded through the globalCOAL screen at
$104.75/MT i.e. 20 cents lower than a similar trade done Monday and 85 cents
higher than the Platts 90-day assessed price on Monday.
Market participants have expressed surprise at the return of
interest for Richards Bay coal as the Atlantic coal market has been
overshadowed by oversupply and healthy coal stockpiles.
A utility source agreed that the interest is mostly coming
from India, adding that the market is “a little bit of a lottery” at
the moment considering the levels of the new trades coming in.
“Allegedly an Indian counterparty listed a $105/MT offer after the market
traded at $103.20/MT Friday, so you have to say that demand is coming from over
there,” he said.
“[Indian buyers] probably saw the prices falling in the third and
beginning of fourth quarter and have not been willing to catch a falling knife
and decided to not booked any forward supplies,” the trader said, adding
that what is surprising is that they are still short and asking for March
cargoes.
“I think they've been a bit naive and hoping for a larger and bigger
correction, panicking a little bit and paying up. It is more a timing issue
than a shift in the nature of the balance of the market,” the trader said.
Source: Platts
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