Traders took a wait-and-see attitude towards thermal coal market in southern China, as sparse trades raised concerns about near-term demand.
Trading activities remained weak as demand lacked support, said a Zhejiang-based trader, adding local factories haven't fully resumed operation.
"I would rather wait and see, as price cut has started in the market," he added.
"As mines gradually return back to normal production, China's coal supply is relatively ample, while slow factory resumption and high utility stocks continue to curb coal demand," said a trader at southern ports.
Offer prices were steady at 685-695 yuan/t for 5,500 Kcal/kg NAR coal and 610-620 yuan/t for 5,000 Kcal/kg NAR coal, ex-stock Guangzhou port with VAT.
Low coal stocks continued at southern ports as well as northern ports, so there were slim chances to see large extent of price decline, according to a Guangzhou-based trader.
Utilities in southern Guangdong province were crazily seeking low-priced coal, causing fierce price war in the local market, said a trader at Guangzhou. Some miners even offered 5,500 Kcal/kg NAR coal at as low as 620 yuan/t ex-stock Guangzhou port, greatly hitting local prices.
Coal stocks at Guangzhou port was at 1.23 million tonens on February 16, a week-on-week drop of 0.8%. Coal stocks at Ningbo and Fangchenggang port stood at 2.38 million and 3.1 million tonnes on February 13, up 19.2% and 3.3% on the week, respectively.
Fenwei assessed Chinese 5,500 Kcal/kg NAR coal traded at Guangzhou port at 680 yuan/t ex-stock with 17% VAT on February 15, steady week on week; 5,000 Kcal/kg NAR coal was assessed at 610 yuan/t ex-stock, flat from a week ago.
(Writing by Jessie Jia Editing by Harry Huo)
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