Indian portside prices of Indonesian coal fell this week, dragged down by global prices at Indonesian ports which fell by $5/tonne (t) on average as on 10 Dec’21. But, overall, buyers postponed their purchases in anticipation of further drop.
After falling around $5/t, prices of 4200 GAR are now assessed at INR 7,500/tonne (t) ex-Kandla, down by INR 500/t w-o-w while 5000 GAR material is changing hands at INR 10,500/t amid low demand from buyers. Prices exclude cess and GST.
According to market participants, Indian end-users continued to avoid bulk bookings as they expect import prices to drop further.
“Given the current market conditions, end-users are already sitting on sufficient stock or they are assessing the market before making any major bookings. We have currently postponed our purchases from Indonesia, anticipating that prices would fall further from here,” quoted a northern India-based trader.
As per CoalMint’s vessel line-up data, a total of 0.44 mn t of Indonesian coal is slated to arrive at various Indian ports between 13-25 Dec’21.
Imported Indonesian coal prices
| Grade | Dec’21 W1 | Dec’21 W2 | w-o-w change in $/t |
| 3400 GAR | 45.9 | 45.3 | -0.6 |
| 4200 GAR | 70.6 | 65.9 | -5 |
| 5000 GAR | 103.93 | 100.3 | -4 |
| 5800 GAR | 129.44 | 126.7 | -3 |
| 6500 GAR | 149.76 | 149.5 | -0.2 |
The Indonesian Coal Index (ICI) fell further last week as Chinese traders stepped back from purchases amid cheaper domestic prices and rising output.
According to market participants, Indonesian coal traders continued to negotiate deals at lower prices to clear stock, while miners held on to offers or were offering at a premium of $1-2/t amid expectation of prices rising to some extent.
Buying sentiment has become subdued against the backdrop of rising coal supply in China and due to the recent less-than-expected cold weather in the country.
According to the China Meteorological Administration, regions in east China and some places in the south are expected to be 4-6 celsius higher than normal in the upcoming week amid the sudden weakening of the cold wave.
Short-term outlook
Indonesian coal demand from China is likely to remain range-bound with minor fluctuations in the near term. Demand from India is also likely to be limited in anticipation of further fall in imported coal prices, thereby keeping portside rates in a tight range over next week.
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