Thursday, 28 Jul 2011
Reuters reported that European and prompt South African physical coal prices rose by around 50 US cents as coal continued to track oil but prices were also slightly boosted by increased buying interests from traders for DES ARA and South African cargoes. The threat of a strike by South African coal miners is also helping to support coal prices.
The Chamber of Mines said that coal mining firms in South Africa were served with a strike notice after talks with unions failed. The Chamber of Mines, which is negotiating on behalf of several mining companies, said it had made its final offer. Overall coal prices remain range bound. There has not been enough buying interest in the Atlantic or Pacific to push prices out of their current range for several weeks. European end users' needs are covered until end August but German generators are expected to come back for Q4 spot cargoes in September 2011.
A source at one major European utility said that "It could start to get interesting in September if the Germans come back to buy as expected and with the nuclear shutdowns, it's likely that they will need to buy more, fresh coal for Q4. But it's range bound still for swaps and physical."
Swaps traders said API2 swaps have been in the range USD 126 to USD 130 for several weeks and show little sign of shifting significantly unless fresh news gives the market a jolt. Despite rumors of new Chinese buying, physical traders said the only cargoes being sold into China are heavily discounted.
One Europe based trader selling to China said that "Some coal, including South African, is going into China and some cargoes are coming to Europe but at huge discounts. Nothing is pricing in at the visible benchmark prices, the buyers just aren't interested at those levels."
(sourced from Reuters)
Reuters reported that European and prompt South African physical coal prices rose by around 50 US cents as coal continued to track oil but prices were also slightly boosted by increased buying interests from traders for DES ARA and South African cargoes. The threat of a strike by South African coal miners is also helping to support coal prices.
The Chamber of Mines said that coal mining firms in South Africa were served with a strike notice after talks with unions failed. The Chamber of Mines, which is negotiating on behalf of several mining companies, said it had made its final offer. Overall coal prices remain range bound. There has not been enough buying interest in the Atlantic or Pacific to push prices out of their current range for several weeks. European end users' needs are covered until end August but German generators are expected to come back for Q4 spot cargoes in September 2011.
A source at one major European utility said that "It could start to get interesting in September if the Germans come back to buy as expected and with the nuclear shutdowns, it's likely that they will need to buy more, fresh coal for Q4. But it's range bound still for swaps and physical."
Swaps traders said API2 swaps have been in the range USD 126 to USD 130 for several weeks and show little sign of shifting significantly unless fresh news gives the market a jolt. Despite rumors of new Chinese buying, physical traders said the only cargoes being sold into China are heavily discounted.
One Europe based trader selling to China said that "Some coal, including South African, is going into China and some cargoes are coming to Europe but at huge discounts. Nothing is pricing in at the visible benchmark prices, the buyers just aren't interested at those levels."
(sourced from Reuters)
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