Coal Price Information
By Clyde Russell | Reuters
LAUNCESTON, Australia, Dec 5 (Reuters) – Coal prices around the world are gently sliding as demand from top importers such as China, India and even Europe remains subdued amid a so far mild northern winter. However, there is one exception.
South African coal export prices at Richards Bay have surged in recent months, defying market fundamentals and seemingly without logical explanation.
The daily Richards Bay index, as assessed by commodity price reporting agency Argus, jumped 44% from $56.54 a tonne on Sept. 25 to a recent high of $81.30 on Nov. 28.
It has since retreated slightly to end on Wednesday at $81.30 a tonne, but the Richards Bay outperformance over other benchmarks has been staggering.
The price of thermal coal delivered into northwest Europe dropped 16% from a recent high of $64.07 a tonne on Sept. 16 to the close on Wednesday of $54.04.
The weekly index for benchmark Australian thermal coal at Newcastle port has traded sideways in recent months, going from $63.22 a tonne in the week to Sept. 27 to $65.31 in the week to Nov. 29…Full Story
There wasn’t a great deal of activity in the Asian markets today, as most market participants wait to see if next weeks coal conference in Bali will shed some light on the direction of the market.
The heavy flooding in Kalimantan continues to have an impact on coal cargos from Indonesia, which are still delayed as the damage caused by the heavy rains is repaired.
Offers for 3800NAR were heard at $38.00/mt for geared and grabbed panamax loading in July.
A bid for 3700NAR was heard at $34.65 for a July Supramax
Not much activity in the Newcastle physical coal market today, although an for an August loading cargo of 6000NAR was heard at $70.00 in 55kt.
Jul loading capes are seen valued at $51.00/mt for high ash 5500NAR material, by Chinese buyers. Sellers are not biting and continue to hold for higher prices around $53-$54.00/mt.
McCloskey reports that there, “was a lot of talk today about a notice distributed to all ports by customs reminding them of their duty to pay attention to the “quality” of coal imports.”
A cape of Colombian material was heard at $63.00 Bid // 65.50 Offered for 5500NAR CFR Chinese ports.
South African 5,700 kc NAR is valued around API4 minus $4.00/t for July and minus $4.50/t for August loading cargoes.
Due to falling paper prices however, translations for what this means on a fixed-price basis show softer prices, with July at around $57.45/t FOB, basis 4,800 kc NAR
Discounts for 5,500 kc NAR shipments are valued at API4 minus $7.50/mt for July minus $7.50/mt August loading. On a fixed price basis this is approximatley $49.25/t FOB for July Loading cargoes.
Monday has seen a quiet start to the week, probably as market participants watch to see the direction the market will move over the coming few days.
There were few trades in the FOB Newcastle market:
July FOB Newc Traded @ $91.00 in 25kt via globalCOAL (6000NAR)
June FOB Newc Traded @ $89.00 in 25kt via globalCOAL (6000NAR)
May FOB Kals $37.00 Bid / $39.00 Offered 75kt Geared and Grabbed (3800NAR)
May FOB Kals Traded @ $55.00 in 75kt (4800NAR)
May FOB Kals $60.00 Bid / $62.50 Offered 75kt (5500GAR) G&GA
After the prices came off last week, it seems traders are taking a step back to assess the situation in the Asian markets this week. Little activity has kept prices relatively stable so far. South African markets have been quiet after the four trades on Monday.
May FOB heard bid at $28.75 for 3800 GAR cargo
April FOB Kalimantan Trades at $22.15 basis 3000NAR (Geared Vessel)
April FOB $36.50 Bid 3800NAR 75kt (Geared Vessel)
April FOB Kal. heard Trading at $54.80 in 75kt basis 4800NAR
April FOB Vanino $65.00 Offered 50kt basis 5500NAR
Value for 5700NAR min cargos is around API4 minus $8.25 on an Index basis. On a fixed price basis this equates to around $67.40
April FOB RBCT API4 minus $14.00 Bid / minus 13.00 Offered 50kt 5500NAR
May FOB RBCT API4 minus $21.00 Bid / minus $20.00 Offered 75kt 4800NAR
Australian and Indonesian thermal coals are facing downward pressure as a result of reduced prices in the Chinese market, caused by lower consumption at coastal plants and decent stockpiles. Derivatives were also trading lower on Chinese exchanges. Although there does seem to be some physical activity going on as some buyers seem prepared to wear the demurrage risk for customs delays in China, on Australian cargos.
March FOB Heard Traded around $41.00 in 75kt Basis 3800NAR
April FOB $41.00 Bid heard in 75kt basis 3800NAR following the above trade
3400 NAR material was heard bid $31.75 for a
1HApril FOB $59.75 Offered in 75kt 4800NAR
May FOB $50.60 Offered 75kt basis 4400NAR
McCloskey reports that customs has increased controlling measures on Australian coal entering Chinese ports and this is having a dampening effect on demand as long waits are causing fears of steep demurrage penalties. This has resulted in increased demand for Indonesian and Russian coal into the Chinese market.
South and East Kalimantan are both still experiencing heavy rains although conditions are said to have improved somewhat at North Kalimantan anchorages.
March FOB was heard $39.50 bid / $40.50 Offered for a geared vessel
Prices remained steady in the South African market with 6000NAR being valued around $77.60 for 6000NAR FOB Richards Bay. 5700NAR material was valued at API4 MINUS $7.50 or $76.95 for prompt cargos.
Cargos of 5500NAR material were valued at API4 MINUS $15.50 or $64.00 on a fixed price basis.
There was continued demand for 4800NAR material but this is in tight supply. Shipments for 4800NAR were valued at API4 MINUS $22.45 for spot cargos.
Confusing sentiment in the coal market over the last couple of days with European markets showing a decidedly bearish outlook off the back of, low gas prices, reduced demand and high stocks. Platts, reports that Dutch terminals, OBA, EMO and OVET are showing stock increases of 49% over this time last year.
The South African market showed a different outlook though with a 50kt parcel of RB1 loading in April, trading at $82.50/mt. This is an increase of $5.90 over the previous relevant trade on 14th February. Argus reported that this was the single largest session-on-session gain in over 10 years for RB1 coal, with their price assessment for spot RB1 now being marked at $80.97, an increase of $6.67 on the day.
The Pacific market remains firm with bad weather at Indonesian ports in Samarinda and Kalimantan preventing trans-shipment of coal loaded by barge onto larger vessels. This output restriction, coupled with continued buying demand from China and India has helped to keep prices in the region firm.
Kalimantan ports and anchorages are still suffering from heavy rainfall, putting pressure on supply and boosting demand for low rank and sub-bituminous coals.
Strong Indian buying interest for Indonesian low rank coal has also been supporting prices. There has also been strong interest for South African off spec coals from Indian buyers although at current levels offers are few and far between.
What was Heard in the Market
April FOB Newc TRADES $94.50 in 25kt via globalCOAL
March FOB Newc $60.50 Bid / $62.50 Offered in 150kt (5500NAR High Ash)
March FOB E.Kal TRADES $55.00 in 75kt Geared Vessel 4700NAR
March FOB Kal $56.00 Bid / $57.25 Offered 75kt 4800NAR.
March FOB Kal $29.25 Offered 3400NAR G&G Vessel
March RB1 heard TRADED @ $76.60 in 50kt via globalCOAL