* Nov DES ARA trades at $89/T, unchanged
* Oct S.African cargo trades at $86.65/T
* Weak dollar supports coal commodity prices
LONDON, Sept 17 (Reuters) – Prompt coal prices drifted
around 30-50 U.S. cents a tonne lower on Monday on tepid buying
interest but the drop was limited because a weak dollar and
steady oil prices offered support.
Prices for both delivered Europe and FOB cargoes have been
range-bound between $83-$89 a tonne for a few weeks and while no
dramatic price moves are expected, traders say some weakening is
likely in the very short-term, with a gradual rise in the next
two quarters.
“Coal swaps rose in the morning with oil and helped by the
dollar’s weakness, which in turn was hammered by the strong
euro, but physical is trading at a fairly big discount to
swaps,” one European trader said.
A November loading South African cargo traded on Monday at
$86.65 a tonne FOB Richards Bay, unchanged from Friday, but
swaps at the time of the deal were $2.00 higher than the traded
price.
The premium or discount of physical prices to swaps can be a
good indicator of the market’s strength.
The dollar hovered near a seven-month low against major
currencies on Monday after the U.S. Federal Reserve’s
announcement of aggressive monetary easing, giving support to
commodity prices.
Continued…
