Coal
The downward trend in coal markets persisted today, with significant declines across major indices. European gas prices followed a similar path for most of the day but recovered slightly by the afternoon, ending marginally lower for the front month.
Physical Newcastle markets remained quiet, with NEWC swaps guided lower by the ongoing weakness in API2, reflecting prevailing bearish market sentiment.
Dutch TTF
European natural gas futures fell to €45/MWh, their lowest in nearly three weeks, as milder temperatures expected later this month are likely to boost availability. Weekend forecasts predict near or slightly above-normal conditions, stabilizing supplies. Storage levels remain below last year’s, at just under 70% compared to 83% in 2024.
Norway’s Gassco announced ongoing maintenance at the Kollsnes processing plant until January 11. Earlier this month, halted Russian gas flows following the expiration of a transit deal pushed prices above €50/MWh, their highest in 14 months, raising fears of storage depletion.
In the US, natural gas futures climbed above $3.7/MMBtu on supply disruptions and strong demand. US utilities reported a faster-than-expected withdrawal of 40 bcf, lowering total storage to 3,373 bcf as cold weather persists.
Brent
March Brent crude futures rose toward $77, supported by supply concerns amid falling US crude inventories and reduced Russian seaborne exports, which reached their lowest levels since August 2023.
Cold weather driving heating demand further bolstered the market, alongside a 1-million-barrel drop in US crude stocks. However, gains were limited by weak demand signals from China, where inflation nears zero, and a stronger US dollar, dampening oil’s global appeal. Record imports from Canada, at 4.42 million barrels, added to supply.
Iron Ore
Iron ore prices for 62% Fe cargoes remained below $98, hitting a three-month low as weak Chinese economic data and deflationary pressures weighed on sentiment. Steel mills continued cutting production due to shrinking margins, with further declines expected.
Despite this, port arrivals increased as miners met year-end delivery targets. Positively, China’s consumer goods trade-in scheme sparked hope for stronger demand.
DCE iron ore futures fluctuated upward, with the most-traded I2505 contract closing 0.53% higher at 754.5 yuan/mt. Traders displayed moderate selling interest, while steel mills purchased cautiously.
Copper
Copper prices remained under pressure from US tariff threats on Chinese goods but found support from Beijing’s stimulus measures. Analysts at MUFG forecast copper nearing $10,000/mt by year-end due to tight supply and growing demand for renewable energy technologies.
LME three-month copper gained 0.4% to $9,085/mt, underpinned by optimism surrounding Chinese government policies to spur growth, despite ongoing deflationary concerns.
