Indian buyers look harder at Indonesian coal
Indian buyers started taking more interest in Indonesian coal this week, issuing more enquiries as they gear up for an end to the monsoon season.
Indian buyers typically come back into the coal and petroleum coke markets in the second half of August. Several buyers and traders reported increased enquiries for supply of physical low-CV GAR 4,200 kcal/kg (NAR 3,800) coal. Some sellers expect a slight rebound in the market for September-loading cargoes, but several Indian buyers took the view that prices might soften a little further and remained hesitant about placing firm bids.
One geared supramax of fob Indonesian GAR 4,200 kcal/kg coal was sold by an Indonesian producer at $41/t for end-August loading. And a geared supramax of end-August GAR 4,200 coal was heard sold to India at $40.50/t, but both August cargoes were too prompt for the Argus assessment window.
This followed a trade yesterday for a geared supramax of first-half September loading GAR 4,200 coal at $40.25/t.
A September-loading Panamax of fob Indonesia GAR 4,200 kcal/kg coal was heard traded at $41/t, but this could not be confirmed, while a Panamax for September loading was offered at $42.50/t against a bid at $40.50/t.
This compares with a fob Indonesia October-loading Panamax of GAR 4,200 coal that was bid and offered at $43/t via brokers, suggesting that demand later in the year will be stronger. But no deal was reported as the bid appeared to be tied to coal from a specific mine.
On the fob Newcastle 5,500 kcal/kg market, a series of 25,000t clips were bid on the Globalcoal screen at $68/t for September loading, $69.50/t for October, and $70/t each for November and December. All were stronger than yesterday's bid of $67/t by a western trader seeking 25,000t of the same high-ash coal. The bids do not qualify for inclusion in the Argus index as they fall below 50,000t.
The ICI 4 paper market was little changed ahead of the Indonesian holiday period, with a wide spread between buyers and sellers. One broker put his bid-offer spread $1/t apart for August paper at $40.20/t vs $41.20/t, the September spread $2/t apart at $39.50-41.40/t and October roughly $2/t apart at $39.25-41.20/t. The same broker saw November weaker at $36.80/t bid, with fourth-quarter 2018 bid around $39.25/t.
In China, temperatures are starting to fall, and this is expected to gradually slow consumption. The September ZCE futures contract closed at 627.8 yuan/t today, tracking relatively closely to recent physical spot market levels but softening by Yn6.4/t from yesterday. Open interest on the contract fell by 22,298 lots from yesterday to 100,638 lots, with each lot of 100t indicating potential physical delivery volume at around 5mn t in September.
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India’s Adani Power raises imported coal use in Jan-Mar
India’s Adani Power raises imported coal use in Jan-Mar
Singapore, 6 May (Argus) — India's leading private sector utility Adani Power more than doubled its use of imported thermal coal during January-March and in the April 2023-March 2024 fiscal year to meet rising power demand. The Bombay Stock Exchange-listed firm used 5.19mn t of imported coal over January-March, more than twice that of 1.99mn t a year earlier. Domestic coal burn also rose by nearly 18pc on the year to 8.83mn t during January-March, following higher availability of local fuel and increased dispatches to utilities. Adani Power consumed 19.44mn t of imported coal over India's April 2023-March 2024 fiscal year. This was also more than double that of 7.66mn t in 2022-23. Its domestic coal burn increased by 10pc on the year to 31.72mn t in 2023-24. Higher imports came on the back of a sharp drop in seaborne prices. The Argus -assessed Indonesian GAR 4,200 kcal/kg coal averaged $57.88/t fob Kalimantan over April 2023-March 2024, down by over 31pc from an average of $84.45/t in the year earlier. The company's fuel cost stood at 3.33 rupees/kWh sold (0.04¢/kWh sold) in January-March, down from Rs5.30/kWh sold a year earlier because of lower blended fuel costs, following a decline in seaborne coal prices. Fuel cost for 2023-24 stood at Rs3.59/kWh compared with Rs4.78/kWh in the previous year. Lower imported coal prices also boosted power offtake under imported coal-based power purchase agreements. The company sold 22.13bn units of electricity in January-March, up significantly from 14.25bn units sold a year earlier. It sold 79.27bn units in 2023-24, up from 53.39bn units in the year earlier. Higher volumes during January-March and the fiscal year were driven by its Mundra, Udupi, Raipur, and Mahan plants — apart from the incremental contribution of the Godda unit — which were commissioned in April 2023. Domestic power sales volumes were driven by growing power demand across the country, the company said. Utility demand could continue to support imports by utilities and lift overall Indian demand for seaborne coal. India imported 14.27mn t of thermal coal in March, up by 8pc from 13.2mn t a year earlier, according to shipping broker Interocean data. Thermal power expansion plans Adani Power operates 15.25GW of thermal generation capacity in the Gujarat and Maharashtra states of west India, Madhya Pradesh and Chhattisgarh in central India, Rajasthan in north India, Karnataka in south India and Jharkhand in eastern India. The firm is eyeing a capacity of more than 24GW by 2029. It is undertaking a brownfield thermal capacity expansion of 1.6GW at its 1.2GW Mahan power project in Madhya Pradesh. It has started developing a 1.6GW expansion at its existing 600MW unit in Chhattisgarh. Adani Power has also emerged as the frontrunner to acquire thermal generation capacity and an under-construction project from domestic debt-ridden Lanco Amarkantak Power. Lanco owned and operated a 600MW thermal power plant in central India's Chhattisgarh state and was planning 1.32GW of generating capacity under the second phase of the project. Adani is in the process of acquiring a 1.2GW debt-ridden thermal power project in south India's Tamil Nadu state. Plant operator Coastal Energen is also having a corporate resolution insolvency process. It is evaluating an organic expansion of 1.6GW, besides considering other inorganic acquisition opportunities, to meet strong demand for thermal power in the coming years, the company said. By Ajay Modi Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Canadian rail workers vote to launch strike: Correction
Canadian rail workers vote to launch strike: Correction
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Japan's trading firms see metals prices cutting profits
Japan's trading firms see metals prices cutting profits
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US southbound barge demand falls off earlier than usual
US southbound barge demand falls off earlier than usual
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