* Traders seek bilateral deals
* Nov S.African cargo bid at $78.T, down $2.00
LONDON Oct 22 (Reuters) – Prompt physical coal prices moved
marginally higher by 25-75 cents a tonne although no fresh
trades were reported and demand remained tepid in Europe and
Asia.
Despite surging coal consumption in many European countries,
traders said they had seen little benefit because
utility/traders had bought more than their generating arms will
need through long-term contracts and have had to buy very little
on the spot market.
“Trading the DES ARA or Richards Bay markets via brokers or
on screen offers very little in terms of profits, direct and
bilateral deals are more attractive to us now,” one European
trader said.
Prices have either reached or are very close to the bottom
of the slide which began in June and pushed them to a three-year
low of $80.00/T for South African coal earlier this month,
end-users and traders said.
“There’s support at or close to current prices – I don’t see
more than a slow recovery over months but I also think we’ve
seen the bottom of the market,” another trader said.
Coal prices have been range-bound for months aside from
sporadic moves to a slightly higher or lower price band and this
has also discouraged activity, they said.
Oil dipped in choppy trading on Monday as economic concerns
and expected production and pipeline restarts offset fears about
Middle East turmoil and the potential threat to the region’s
supply but the move in oil prices was not big enough to pull
coal with it.
Continued…
