Indonesia coal prices firm on China, India demand No physical trades on the globalCOAL platform this week

Print this page Posted on : 11-07-2009 by recycleinme.com

Spot requirement from China has helped support prices of high-calorie coal.

Reuters

Jakarta, Nov. 6

Indonesian coal prices firmed this week, supported by strong demand from Chinese and Indian buyers, and prices may increase further on expectations of more demand from China, traders said.

Thermal coal prices on the globalCOAL Newcastle weekly index, a benchmark for Asia, rose $2.11 a tonne, or 2.87 per cent, from a week ago to $75.57 a tonne on Friday, taking their cue from strong oil prices and expectations of demand from China.

Indonesian bituminous coal of 6,300 kcal/kg air-dried basis (ADB) was offered firm at around $60-$61 a tonne, f.o.b. vessel.

''Cargo availability for high-calorie coal is a bit tight because of rains in East Kalimantan, although supply is actually ample,'' an Indonesian coal trader said.

But spot requirement from China has helped support prices of high-calorie coal, traders said.

About 200,000 tonnes of coal with a heating value of 6,300 kg/kcal ADB were sold to a Chinese buyer at around $61 a tonne, a second Indonesian trader said, adding shipments will start in November. There were no details about the buyer. There were no physical trades recorded on the globalCOAL platform this week.

SUB-BITUMINOUS

Indonesian sub-bituminous coal, with a heating value of 5,500 kcal/kg ADB, was offered firm at around $33 a tonne, f.o.b. Vessel from Kalimantan.

''Many spot deals now are going to China and India but supply is still outpacing demand. So we are looking at stable prices for low-calorie coal,'' the first Indonesian trader said. Chinese buyers were scouring for spot shipments until the end of the year and also were looking into locking into long-term contracts, traders said.

bright spot

After demand for thermal and coking coal slumped in traditional importers such as Japan and Korea earlier this year, China emerged as a rare bright spot, importing huge volumes of coal due to the shutdown of many unsafe mines in the country. US coal miner Peabody Energy expects seaborne coal trade in the Pacific region to grow more than 7 per cent annually for several years, underpinned by robust demand from China and India.

A parcel of 30,000-tonne of Indonesian coal with a heating value of 5,500 kcal/kg ADB was traded at around $36 a tonne, f.o.b. vessel, the second Indonesian trader said. ''India is also in the market, making inquiries, but they are offering prices lower than China so we are a bit reluctant,'' he said. Indian buyers wanted to buy coal of 5,500 kcal/kg ADB at a price in the low $30s a tonne, traders said.

Source : Business Line