* Coal prices to recover in H2 – Reuters poll
* High inventories depress prices
LONDON, March 5 (Reuters) – Prompt physical coal
prices were steady on Monday despite a rise in oil prices.
Spot coal demand in Europe has been tepid for the past
several months and is unlikely to start reviving, even slowly,
until the second half of the year, analysts said.
“Short-term the potential for coal prices to recover is
limited, there are high inventories everywhere,” said Emmanuel
Fages, Paris-based analyst with Societe Generale.
The market’s direction also depends heavily on China’s spot
buying, which is a key market indicator, he said.
So far this year, China has bought very few fresh cargoes
but has continued to ship those bought last year.
Oil prices will continue to give some structural support to
coal, traders and analysts said, but on a day to day basis the
illiquid coal market does not always move with oil.
On Monday oil rose in tug-of-war trading, as supply risks
and tensions over Iran supported prices but China’s lowering of
it economic growth target and weak U.S. factory orders were
bearish factors.
Continued…
