Indonesian thermal coal prices hold steady

Indonesian thermal coal prices held steady today, with details of physical trades emerging at similar levels to recent transactions.

A 20,000t block of December contracts traded late in the day yesterday in the ICI 4 derivatives market. The 20,000t block of ICI 4 derivatives changed hands at $30/t, brokered by Singapore-based Evolution. The latest trades mean that around 1.73mn t has been cleared on the CME since the contract launched in February.

Trade in the ICI 4 derivatives market, which clears on the CME, has been relatively slow this week. December paper was offered at $30.50-31/t today for 5,000t, with bids at $29.50/t.

Around 185,000t of ICI 4 derivatives contracts traded in November. This was slower than September and October when the highest volumes were cleared on the CME at 260,000t and 265,000t, respectively.

In the GAR 4,200 kcal/kg physical market, a mid-December loading geared Supramax was heard to have sold at $28.50/t.

A GAR 4,200 kcal/kg gearless December-loading Panamax vessel was heard to have changed hands at $31.50/t to China, while another gearless Panamax cargo of the same coal was heard to have traded at $30.30/t for second-half December loading, but this could not be confirmed.

Offers in the GAR 4,200 kcal/kg coal market were heard at $30.50/t. Some market participants think that deals will now be concluded at around $30/t for January-loading cargoes. Bids for GAR 4,200 kcal/kg late-December/early-January gearless Panamax cargoes were heard at $30.15-30.25/t.

In the Australian high-ash market, a NAR 5,500 kcal/kg 75,000t January-loading cargo was heard to have traded for $58/t fob Newcastle on 4 December. This follows a NAR 5,500 kcal/kg January-loading Capesize cargo that traded on the same day at $59/t on a fob Newcastle basis. But no other deals, bids or offers were heard today.

Trade levels reported this week are somewhat higher than prices in the high-ash NAR 5,500 kcal/kg fob Newcastle market, which were assessed most recently at $57.91/t on 30 November. But market participants think this may just be a temporary recovery in a declining market.

In the China domestic market, the colder weather in southern and eastern China has stimulated heating demand. But this did not appear to provide any immediate support to prices.

Offers of NAR 5,500 kcal/kg coal remained at around 630 yuan/t fob northern China ports, while some smaller utilities were looking to buy at Yn620/t or lower.

In the China's futures market, the January contract on the ZCE rose by Yn10.20/t on the day to Yn607.80/t today on stronger coal burn.