* Oct DES ARA trades at $91.25/T, up $1.25
* Chinese coal defaults worsen
* Indian buyers also default, on smaller scale
LONDON, July 27 (Reuters) – Physical prompt European coal
prices rose by around 50 cents to $1.00 a tonne on Friday,
bolstered by strong swaps values, but weak fundamentals could
reassert themselves soon and pull prices down, traders and
utilities said.
Coal swaps rose by $1.00 on Friday in line with stronger oil
and the euro.
“Fixed prices have gone up today but the discounts to
indexes have increased,” one European trader said.
An October DES ARA cargo traded on Friday at $91.25 a tonne,
up more than $1.00 from the previous day’s most recent trade,
but the discounts offered to the API2 index have increased to
$2.40 a tonne below index from around $2.00 earlier in the week.
“These prices are not justified by fundamentals,” the trader
said.
Until inventories at ports in China, India and Europe’s
Amsterdam-Rotterdam-Antwerp import hub are consumed and the flow
of discount-priced cargoes unwanted by China dries up, the
market cannot start genuinely to stabilise, traders said.
Continued…
