Indonesian thermal coal portside prices fall amid sluggish domestic demand

• Plants may begin purchasing in coming days
• Extended monsoon keeps market under pressure

The Indonesian thermal coal portside market remained subdued this week as coal prices came under pressure due to lacklustre demand from the steel and cement sectors in India. However, with inventory levels under consideration, plants may begin purchasing in the coming days.

Specifically, prices of 3400 GAR coal at Navlakhi Port dropped by INR 200/tonne (t) to INR 4,900/t. At Kandla, prices of 4200 GAR coal remained stable at INR 5,900/t ex-port. Additionally, prices of 5000 GAR coal at Kandla and Vizag ports decreased by INR 100/t, settling at INR 7,900/t and INR 7,800/t, respectively.

In India, coastal-based plants have shown interest and continue their routine purchases despite reduced domestic supply. The portside stock is expected to be replenished by the end of September, as some imported coal shipments are yet to arrive. However, the market remains slow since coal stocks at power plants are sufficient for nearly 14 days of usage.

Key factors influencing Indonesian thermal coal prices

• Index prices largely stable w-o-w: Indonesian indexed prices of high-CV (5800 GAR) coal were recorded at $92.42/t, rising by $0.21/t. Mid-CV (4200 GAR) coal prices increased by $0.53/t to $50.91/t, while low-CV (3400 GAR) coal prices were recorded at $31.16/t, up by $0.13/t. All prices are on an FOB basis.
• Supply-demand variation: In the Chinese domestic market, coal prices remained firm due to reduced stock levels at major ports. However, ongoing low industrial demand and uncertain weather patterns have made buyers cautious. Notably, offers from suppliers edged up in anticipation of Chinese restocking ahead of the Golden Week holiday in early October. Despite this, China’s top consumers maintained a strong bargaining position, keeping bid levels subdued.