Chinese Imported Coal Prices Forced Down

BRISBANE, Australia - July 12, 2013 - PRLog -- Reports of a top domestic miner selling off its stocks at Huanghua port at huge discounts have sent a disruptive wave through the market, leaving many Chinese traders no option but to follow suit and match prices.

Some traders are thinking it will be a long, tough struggle over the summer, and with the bleak economic outlook for the second half of the year import prices might not recover until next year.

Adding to the competition between South African and Australian material, Colombian producers have also started to seek opportunities in Asia due to record low Atlantic prices.

However, Chinese traders told IHS Coal that they will consider Colombian material only when the prices are even more competitive.

One cape of Australian high ash material was reportedly done at $82.00/t CFR, basis 5,500kc NAR into Zhoushan for August arrival, while another Australian cape was traded at $81.00/t CFR, basis 5,500kc NAR into Xiamen, also for August.

In the sub-bituminous market, one panamax carrying 4,900kc NAR was traded at $71.00/t CFR into Quanzhou for July arrival, and another panamax was transacted at $66.50/t CFR, basis 4,700kc NAR, into Guangzhou (GZ) in August. Two August arrival cargoes of low ranked material were done at $49.50/t CFR, basis 3,800kc NAR, and $49.00/t CFR, basis 3,700kc NAR, both into GZ.

Domestic trades out of Qinhuangdao (QHD) recently were captured in the range of $95.62-96.43/t FOB, basis 5,500kc NAR (inclusive of VAT).

Lower c.v. material traded between $80.23-82.66/t FOB, basis 5,000kc NAR. In the less active 5,800kc NAR market, value appears to be between $101.30-102.11/t FOB.

More information can be found in the McCloskey China Coal Report which presents monthly updates on both the producer and consumer sides of the Chinese coal market.  With information on trade, transport and policy updates, the McCloskey China Coal Report provides comprehensive coverage for anyone dealing with the Chinese coal market. Enhance your monthly subscription with the McCloskey China Coal Daily, updated every weekday.

For more information or for a free trial subscription, please contact epi.coalinfo@ihs.com, call +61 7 3020 4000 or visit http://www.coalportal.com/.