The mood in the imported coal market has improved since this week. Supported by a narrow fall in domestic trade prices for coal and insufficient sources of minerals, import traders have shown a greater willingness to compete, and tender prices for power plants have gradually stabilized. However, the current large-scale terminal depot has not yet been activated and downstream procurement flow continues to be frequent.
According to market sources, the FOB price for 3,800 large cedars in Indonesia is currently in the range of US$ 81-82 per ton. While some of Indonesia ' s producing areas have been delayed by rainfall, overall supply constraints are mainly due to the mining party ' s initiative to control the delivery rhythm.
Market participants have indicated a weak willingness on the part of the miners to export goods, a tight supply of coal for the November period, and a general projection that the market will release in December or a certain amount, and that production will increase further when the new annual production plan enters into force next January.
The supply of high-calorie coal is similarly scarce, and according to market sources, the maritime market has few Australian coal pallets and prices are running at a steady rate, with Australia offering $114-115 FOB for 5,500.
According to market participants, by the end of this year, there were almost no ships to sell, traders had few available supplies and new markets were expected to be limited.
As a result of the appreciation of the renminbi and the fluctuations in freight costs, the value of C$ 3800 South-to-CIF was around $690 per ton. The price of intra-trading coal fell narrow, and the actual tender price for some plants was below $690 per ton.
Current imports of coal still have a price advantage over domestic trade, but have been significantly narrower than in the previous period and have not been effectively translated into actual trade. Market sentiment is now high, and viewers are subject to domestic growth expectations that they will not be able to rise significantly, and fallers are subject to external constraints that are hard to collect at low prices.
The market is expected to continue to be supported by tight external mineral supply and winter storage demand, and there is no willingness on the part of the miners to sell at low prices, based on domestic market obligations and higher prices in the maritime market. Some miners tend to operate at relatively high prices, even when they face export pressure.
At the same time, near the winter, there is still room for recharge of the power plant, with limited supply in November, to support the market. In addition, domestic coal prices fell in a narrow manner and market sentiment led to relatively limited space for lower prices of imported coal.
Domestic terminal power plants and traders have performed with caution in comparison. While some of the power plants in South China still have a good load, large-scale purchases have been suspended, mainly on demand, based on the expectation that post-market coal prices will continue. At the same time, the price of imported coal onshore has increased, and the cost of receiving goods from traders is high and more difficult to operate.
In addition, the expected increase in intra-trade coal production under domestic supply policies may stifle the increase in the price of imported coal; and the frequency of final bidding flows reflects limited real demand releases in the market and insufficient incentives for further price increases.
Taken together, the current import coal market is characterized by an increase in supply and demand, a combination of strong foreign ore prices and terminal prices, and a lack of clear unilateral drivers in the market. The price of imported coal may or will remain narrow in the short term, followed by a focus on the release of domestic winter storage needs and the further impact of Indonesian policy on the offer.