China's import thermal coal market showed signs of weakening after stabilizing for one week or so, as few Chinese utilities seek the material abroad after domestic power demand dropped significantly because of the coming one-week Lunar New Year break.
"We took three ships of late March-delivery Indonesian thermal coal recently, with 3,800 Kcal/kg and 4,600 Kcal/kg NAR coals at 445 yuan/t and 605 yuan/t CFR (VAT and port construction fees included)," said a Fujian-based utility source.
However, he reported weaker prices after the purchase. "I thought a downturn would occur after the Lunar New Year holiday along with tepid appetite for the fuel, but apparently it came a bit earlier," he noted.
He added it only took 5-7 days to clear customs in February, which, however, may recover to normal time length of three weeks after the holiday.
A Guangxi-based trader said offer prices of Australian 5,500 Kcal/kg NAR coal slid marginally to $88/t FOB in recent days, which didn't lead any deals to conclude yet.
"Chinese power plants basically sat on the sidelines and halted taking overseas material in days close to the holiday," he said, adding there hadn't been any official notice on reinstating import restrictions at Fangcheng port after February 15.
A Shandong-based trader placed offer prices of Indonesian 3,800 Kcal/kg NAR coal roughly stable at $50/t FOB, adding his firm almost suspended import coal trades recently to celebrate the Spring Festival.
"Though Indonesian miners didn't adjust down their offer prices, some traders did undercut the material to clear stocks in hand before the festival," said a Shanxi-based trader.
"There are only two utilities in Fujian issuing tenders this week, and prices they offered were relatively low at 441 yuan/t CFR with VAT and port construction fees or less than $50/t FOB on Supramax basis," he said, noting prices may further go down after the holiday.
The shipping rate for Supramax vessels from Indonesia to South China stood at $7.3-7.4/t, he added.
The Fenwei CCI Import 5500 index was assessed at $98/t on February 13, CFR southern China ports, falling $0.2/t from a day ago and $0.5/t from a week ago.
On the same day, the 4,700 Kcal/kg NAR import coal was assessed at $80.3/t, CFR southern China ports, stable from the day before and up $0.3/t from the week prior; imported 3,800 Kcal/kg NAR coal was assessed at $57.3/t, dipping $0.1/t day on day and $0.4/t week on week.
(Writing by Tammy Yang Editing by Harry Huo)
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