Indonesian coal prices have witnessed no significant movement this week, as the participants await the return of Chinese buyers.
Coal prices had remained at almost the same levels as that of the previous week, with 4200 GAR coal assessed at USD 51-52/MT, FoB Kalimantan and 3800 GAR coal at USD 41/MT, FOB Kalimantan.
Market participants were anticipating that the prices would soften amid the absence of Chinese buyers during their New Year’s holidays. However, Indonesian coal index had continued its journey on a rising trend, with ICI 4 (4200 GAR) rising by USD 0.72/MT on the week to USD 51.04/MT.
An Indian trader had commented that the buying trend of the Chinese buyers’ would give direction to the coal prices. If they (Chinese buyers) continue to buy coal aggressively, the prices would sustain; otherwise prices would soften.
Although, he remained optimistic of the fact that normal coal production by the end of Mar’18, would certainly improve the coal supply. Indonesian coal production was restrained due to the bad weather condition, which has been the prime reason for why the coal prices had remained firm at high levels, he added.
Indian Buying Scenario:
The need to restock coal at the power plants had kept the demand intact from Indian buyers. However, the higher offers for Indonesian coal had curtailed their buying interest.
A trader had commented that no immediate buying was seen from the Indian buyers, as they were waiting for an expected price correction.
As per the data provided by CEA, coal stock available at Indian coal-fired power plants was assessed at 15.548 MnT as on 26 Feb’18, with 25 plants having a critical stock level of less than 7 days.
Current Offers for Indonesian 4200 GAR coal was heard at 61-62/MT, CFR India, while 3800 GAR coal was priced USD 51-52/MT, CFR India.
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