India: Portside prices of Indonesian thermal coal remain steady w-o-w amid weak sentiment

• Low portside trading due to ongoing holidays
  
  
• Weather condition, year-end tighten supplies
  
  

Indonesian thermal coal prices at Indian ports remained steady w-o-w due to sluggish demand. In the domestic market, abundant stock levels, reduced urgency to close deals, and the approaching winter and New Year holidays have contributed to slower trading activity. Furthermore, weak demand from key importers, including India and China, intensified the market's decline.

Prices of the 3400 GAR coal at Navlakhi Port remained stable w-o-w at INR 4,700/tonne (t). At Kandla and Vizag, 4200 GAR was stable w-o-w at INR 5,900/t and INR 5,750/t respectively. Additionally, 5000 GAR coal offers at Kandla were steady w-o-w at INR 7,900/t, and at Vizag, high-calorific value (CV) coal prices were stable w-o-w at INR 7,800/t.

Notably, thermal coal inventories at Indian ports recorded a slight increase of 0.5% to 13.35 million tonnes (mnt) in week 51 from 13.29 mnt in week 50, according to BigMint's data.

Indian coal market bearish amid price sensitivity, ample supply

The Indian coal market remains bearish as buyers adopt a price-sensitive stance, delaying bids until prices align with acceptable levels. This cautious approach has led to a decline in bids across the Asian thermal coal market, with trading activity slowing due to uncertainty about a potential price floor. While coal stocks at Indian power plants have risen to cover 15 days of consumption, some plants are still operating with critically low inventories, sources stated. Overall, subdued demand, falling bids, and sufficient supply continue to outweigh temporary shipment delays.

Coal shortage continues to pressure supply

An Indonesian source highlighted that adverse weather conditions and ongoing New Year holidays could hamper trading activities. Export quotas are typically finalised by year-end, and may take time for renewal, further tightening supply. Also, smaller mining operations are also expected to face delays of several weeks in obtaining the necessary approvals to resume exports, which could drive prices upward in the coming months.

Indonesian indexed prices of high-CV (5800 GAR) coal were recorded at $90.75/t, down $0.90/t. Mid-CV (4200 GAR) prices decreased by $0.58/t to $50.03/t, and low-CV (3400 GAR) was recorded at $30.93/t, a fall of $0.27/t. All prices are on FOB basis.