The Indonesian coal market has been sluggish as buyers, particularly China, are slowing down purchases, traders said.
A trader based in India, said he hasn’t received any offers from Indonesian suppliers this week, highlighting the lacklustre market.
But buyers are looking to buy coal with heating value of 4200 GAR at around USD 40/MT for August shipment, he said. Demand remains weak as traders still have plenty supplies, although end-users are still looking for coal, he said.
Market was subdued despite China’s coal imports in July hit the highest in 4 ½ years, as summer boosted demand for electricity to run air-conditioners to cool houses and offices.
China’s coal imports surged by 23.9% in July, from 25.47 MnT in June, Reuters reported, citing data from the country’s General Administration of Custom. It was the highest imports since January 2014.
Despite the strong imports, Chinese demand is yet to lift up the prices.
Another trader in Jakarta said Chinese buyers have yet to step up their buying, despite dwindling supplies.
“In my opinion, they (Chinese buyers) are trying to force the price down. Plus, their hydro is working well. So, probably there’s impact on its total coal consumption,” said the trader.
However, prices are expected to rebound as demand from India seen picking up as monsoon will be over the next month, the Indian trader said.
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