* June DES ARA trades at $96/T
* Prompt coal seen disconnected from oil
LONDON, April 17 (Reuters) – European physical coal prices
dipped by around 50 cents on Tuesday due to continued oversupply
with only one fresh trade reported, utilities and traders said.
Oil prices nudged up close to $119 a barrel but spot coal
prices are much less aligned with the oil market than forward
values for 2013 and 2014, they said.
Bearish spot fundamentals were having more of an effect on
coal values than other energy markets, they said.
Activity is likely to be even more muted in Europe this week
than it has been in recent months because so many of the major
players are in Beijing for the biggest, annual China coal
conference.
China has resumed spot imports of low and standard-grade
coal, but buyers are holding out for prices of less than $114 a
tonne CIF and sellers who need to shift prompt cargoes are
accepting these prices, traders said.
“The trend is for prices to go down but the key is the
values achieved by U.S. Illinois high-sulphur coals. These are
being sold at extremely competitive prices,” said Martin
Blomendal, consultant with Energy Edge.
Illinois coal with 2.5-4.0 percent sulphur content has been
trading at more than $20 a tonne discount to standard grade coal
prices, end-users and traders said.
Continued…
