* March DES ARA trades at $109/T
* Less Indian interest seen
LONDON Jan 9 (Reuters) – Prompt European physical
coal prices fell by $1 to $2 per tonne on Monday, in line with
weaker oil, as some smaller European utilities started to sell
cargoes they would not need due to the mild winter.
Last week the market appeared to have steadied and tight
near-term supply of South African coal boosted prices, which had
slipped during the Christmas and New Year holidays.
February South African prices saw a lesser fall of around 50
cents because supply for the first quarter remains tight, but
there was less visible interest from India for prompt cargoes
out of Richards Bay.
“The market’s looking a bit more bearish because in Europe
there’s been lower coal burn than expected, the winter’s been
mild, it’s wet and windy but not cold, China won’t be back until
the end of January and the shorts seem to have covered,” one
utility source said.
“Prices were slightly higher in the morning but have
followed oil down,” a European trader said.
“Coal prices are very clearly linked to oil now,” said
Emmanuel Fages, analyst with Societe Generale.
Prices may not slip much further, but unless there is a
significant supply disruption such as floods in Australia,
fundamentals look weaker than they did a year ago, traders,
utilities and analysts said.
Continued…
