PERTH Oct 4 (Reuters) – Australia’s thermal coal price
benchmark was relatively steady this week with Chinese buyers
away from the market for a week-long national holiday, but
prices may rebound soon as buyers begin to restock for winter.
Australia’s Newcastle spot index for the week
closed at $85.85 per tonne on Wednesday, up only slightly from
$85.49 per tonne last week, according to data provided by online
trading platform globalCOAL.
“We’re in ‘shoulder season’ right now; but pre-winter
restocking across northern hemisphere in November and December
means we’re probably close-to-a-low for these prices,” UBS said
in a note to clients this week.
The autumn season is often referred to as the “shoulder
season” by those in the industry because it is in between the
peak demand summer and winter seasons.
Xstrata Plc and Tohoku Electric Power Co’s
settlement of a coal supply contract for the year beginning Oct.
1 at just under $97 per tonne late last week, over $10 per tonne
more than the benchmark at the time, suggests that prices will
increase going forward, market sources and analysts said.
“Looking ahead, with thermal coal demand heading into
seasonal highs in (the fourth quarter), we expect physical
prices to pick up gradually,” Standard Chartered said in a note
to clients this week, citing a recent increase in buying
enquiries from Chinese and Indian buyers.
Despite the absence of Chinese buyers due to the Golden Week
holiday, a few cargoes of Newcastle coal changed hands.
A 25,000 tonne cargo for November delivery traded at $82.50
per tonne, the same price paid for an October cargo of the same
size late last week, according to globalCOAL.
Offers for November cargoes later fell to $81.75 per tonne,
the lowest level seen since December 2009.
Continued…
