China import coal prices roll higher on lack of supply

2017-12-25 17:06:00 Import & Export,  International

Import coal prices inched higher as supply remained in shortage and Chinese utilities showed strong buying interest as they try to meet surging consumption in peak demand winter season.

Supramax Indonesian 3,800 Kcal/kg NAR coal, which was previously offered at $46.5-47/t FOB, has climbed to $47.5-48/t FOB, said a Guangdong-based trader, adding current levels were acceptable to some Chinese end users.

Import price rise was sort of wild in recent days, he noted, adding 4,700 Kcal/kg NAR coal was offered at $67.5/t FOB.

More Indonesian 3,400 Kcal/kg NAR coal was concluded than 3,800 Kcal/kg NAR material, said a Beijing-based trader, adding offer prices for the former stayed high at $47.5/t FOB or above backed by supply crunch.

"Chinese utilities are snapping up import coal," said an eastern China-based trader. "I can't tell the future trends as China is easing import curbs; for now I don't think import price will rise greatly."

Some utilities in the world's top consumer purchased late January-delivery Indonesian 4,800 Kcal/kg NAR coal at 600 yuan/t CFR with VAT, according to the trader.

A foreign trader saw low chance for import prices to edge down, citing strong coal burns at Chinese utilities.

Australian 5,500 Kcal/kg NAR coal was offered firm at $78/t FOB; no one would buy if prices are higher, the trader said.

"There are not many cargoes available in the market; some were sold under term contracts, some miners held back sales," he remarked. "Spot coal also is sold to Japan and South Korea."

The Beijing-based trader said Australian 5,500 Kcal/kg NAR coal was bid at $75/t FOB to offers of some $78/t FOB.

"There is basically no import coal for sale at Fangcheng port," said a Guangxi-based trader. "Little import coal was supplied by overseas miners."

Some traders offered Australian 5,500 Kcal/kg NAR coal at $78-80/t FOB or 710 yuan/t CFR with VAT, the trader added.

Chinese purchase demand has increased, as coal stocks tumbled at utilities amid growing winter heating and power demand, said a Zhejiang-based trader. He reported $78/t FOB offer for Australian 5,500 kcal/kg NAR fuel.

One Shandong-based trader said Australian coal prices are less likely to slide to low level in light of high coal consumption at Chinese utilities. "Australian 5,500 Kcal/kg NAR coal was offered above $80/t FOB, while the cost for the same-CV domestic material at south China ports outstripped $100 CFR," he noted.

A third-Beijing-based trader said he heard Capesize freight rate from Australia to south China was a little higher than $12/t.

The Fenwei CCI Import 5500 index was assessed at $89/t on December 25, CFR southern China ports, stable from a day ago and up $1.3/t from a week ago.

On the same day, the 4,700 Kcal/kg NAR import coal was assessed at $74.8/t, CFR southern China ports, steady from the day prior and up $0.7/t from week prior; imported 3,800 Kcal/kg NAR coal was assessed at $54.8/t, unchanged day on day and up $0.7/t week on week.  

(Writing by Jessie Jia   Editing by Harry Huo)
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