Indonesian coal market makes slow start to the week

The Indonesian physical coal market made a typically slow start to the week, even as enquiries began to increase since the end of last week as some market participants see the market may be finding a floor.

Enquiries from Chinese buyers for prompter cargoes began to surface towards the end of last week as they expect stricter import curbs from October. Indian buyers also started to express interest for cargoes arriving after the June-September monsoon season.

Bid and offer levels in the fob GAR 4,200 kcal/kg market were mostly unchanged today from the end of last week. September-loading geared supramax cargoes were bid in a $30.50-31/t range, while offers were also steady at around $31-31.50/t. Argus assessed the GAR 4,200 kcal/kg coal price at $31.01/t on 23 August.

The ICI 4 derivatives market made a slow start to the week, with first-quarter 2020 contracts offered today at $34.25/t and no matching bids. The last Argus assessed price for first-quarter 2020 ICI 4 futures on 23 August was at $34/t.

Trading activity in the ICI 4 derivatives market was also sluggish last week, with just a 10,000t clip for October clearing at $31.25/t on the CME. Last week's trade took the total ICI 4 derivatives cleared the CME so far this month to 139,000t.

The Australian fob Newcastle market saw an index relevant trade done today at $60.50/t fob for an October-loading 75,000t cargo of NAR 6,000 kcal/kg coal. The level of the trade, which was done on screen, was down from the most recent assessment of $61.72/t fob Newcastle on 23 August.

A 25,000t clip of the same material traded at $65/t fob Newcastle for November loading, also on screen, but this did not fit the Argus index.

Buyers and sellers' expectations in the NAR 5,500 kcal/kg market appeared mismatched as Chinese buyers were seeking September-loading cargoes, while sellers were already looking to offload their October supplies. Buyers' interest for September was in line with last week when a September-loading Panamax was bid at $49/t fob Newcastle.

China's futures market had the September contract on the Zhengzhou commodities exchange close at 586.20 yuan/t today, up by Yn0.40/t from 23 August.