Indonesian thermal coal portside prices fall amid weak market sentiments
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- India's coal ministry prioritises 38 rail projects to cut logistics costs
- Indonesian producers refrain from lowering their offers
The Indonesian thermal coal portside market continued to decline for another consecutive week as abundant stocks held by buyers forced traders to lower their offers to match prevailing bidding levels.
Specifically, prices of 3400 GAR coal at Navlakhi Port dropped by INR 100/tonne (t) to INR 4,900/t. At Kandla, prices of 4200 GAR coal fell by INR 200/t to INR 5,900/t ex-port. Additionally, prices of 5000 GAR coal at Kandla remained stable at INR 8,000/t.
Key factors influencing Indonesian thermal coal prices
- Index prices decline: Indonesian indexed prices of high-CV (5800 GAR) coal were recorded at $92.21/t, inching down by $0.21/t. Indonesian mid-CV prices (4200 GAR) inched up by $0.30/t to $50.38/t. Meanwhile, the low-CV (3400 GAR) prices remained stable at $31.03/t. Prices were on an FOB basis.
- Supply-demand imbalance: In China, traders were compelled to offload their cargoes from ports to avoid incurring port tariffs and to minimise the risk of natural combustion, which can degrade coal quality. As a result, ample stock levels have inhibited imports and pushed offer levels even lower to facilitate deals, despite the heatwaves and high power demand in some southern Chinese provinces.
Indian coastal plants continued their routine purchases, but pre-festival restocking has yet to begin, as buyers are waiting for prices to decline further. Most of the monsoon season's coal requirements were met by increased supply from domestic mines. Additionally, India's coal ministry has prioritised 38 rail projects to reduce logistics costs, improve the efficiency of domestic coal transportation, and ensure the timely delivery of coal from mines to plants.