Indonesian coal market has remained steady, as trades occur at nearly same levels from the previous week.
Indonesian 4200 GAR coal prices were stagnant at USD 39/MT on FoB basis. While Offers for 3800 GAR coal was heard at USD 32-33/MT, FoB Kalimantan against bids at USD 30-31/MT for Oct’18.
Demand for Indonesian low CV coal exists among the Chinese utilities as they prefer blending low grade coal from Indonesia with their domestic coal, but for mid CV coal demand was still adverse.
Buying interest for 5000 GAR coal ranges between USD 52-54/MT FoB depending upon the specification.
Market participants have anticipated that the upcoming tender from a Chinese utility should move the price index up in the coming weeks, as Indian buyers might also get back the confidence to return in the market.
Recently, Chinese utility Huaneng had issued a tender to buy 648,000 MT coal for late October or early November period. Whilst, origin of the 3400-4500 NAR coal that Huaneng was seeking was not specified, but it is likely that it would be sourced from Indonesia.
Price of Indonesian 5000 GAR coal is on a downfall, which have fell USD 11-12/MT since June end.
The free-fall in coal prices have kept Indian buyers especially the traders involved in stock & sale business on the sidelines, as they were waiting for prices to stabilise.
The modest fall in previous week’s 5000 GAR coal index would have pleased the Indian buyers, as the index had restricted its fall to few cents in recent weeks from the earlier recorded hefty declines.
A trader in east coast was hopeful that Indian buying would uptick in the coming weeks, however, he was still wary of the Chinese buying citing that it was too early to predict whether it’s the start of sustained restocking activity or a short lived buying, when Chinese golden week holiday in early October was just a week away from now.
Indonesian 5000 GAR coal was assessed at USD 63-64/MT, CFR East Coast India.
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