Low-CV Indonesian coal prices hold steady

Fob prices for low-calorific value (CV) Indonesian coal held relatively steady as some market participants said that the market may be starting to stabilise.

Most bids and offers for GAR 4,200 kcal/kg product were flat to slightly firmer today, with September-loading geared Supramax cargoes bid at around $30.50-31.50/t and offered at around $31.50-32.00/t. This compares with bids at $30.50/t and offers at $31.50/t yesterday.

Details of firm transactions were slow to emerge, although a September-loading Supramax may have traded at $30.50/t, up slightly compared with a similar trade yesterday at $30.40/t. A Panamax cargo loading in late September-early October, which would typically trade at a premium of around $0.50-1.00/t to Supramax cargoes, was heard to have traded at $31.50/t, while a trader was bidding for a late September-loading Panamax cargo at $31.25/t.

Trade was also muted today in the ICI 4 derivatives market after a total of 104,000t was cleared on the CME last week. September contracts were bid today at $30.80-31.00/t with different Singapore-based brokers and offered at $31.45-31.50/t. Yesterday's Argus prompt month closing swap was at $31.30/t.

First-quarter 2020 contracts were bid today at $33.15/t and offered at $34.15/t, broadly in line with yesterday's Argus settlement price at $33.60/t. First-half 2020 contracts were bid at $33.90/t and offered at $34.20/t.

In the Australian NAR 5,500 kcal/kg market, at least three trades were heard to have been done at $49/t fob Newcastle for September-loading Capesize cargoes going to China, although these deals were not confirmed. Bids were also heard around $47-48/t fob Newcastle for September and October-loading Capesize shipments. The NAR 5,500 kcal/kg market was most recently assessed by Argus at $49.49/t fob Newcastle on 16 August, but market participants believe it could have slipped to as low as $48/t this week.

In the Australian NAR 6,000 kcal/kg market, a 25,000t October-loading clip traded on screen at $62.65/t fob Newcastle. A first-quarter of 2020-loading 25,000t clip traded on screen at a 60¢/t discount on an index-linked basis.

In the Chinese domestic market, coal prices were showing signs of stabilising following consecutive week-on-week falls since 5 July. Offers of NAR 5,500 kcal/kg coal were at 580-585 yuan/t fob north China ports, while bids were around Yn580/t. This compares with Argus' last assessment of Yn579.17/t ($82.01/t) fob Qinhuangdao on 16 August.

In China's futures market, the September contract on the ZCE closed at Yn586.20/t today, down by Yn5/t from yesterday.

source: Argus Media