Saturday, 30 Jul 2011 | By Montel
European coal prices have been mostly unaffected by an ongoing strike by South African miners, as stockpiles are healthy and demand low.
A German utility trader said that "At the moment, the impact is negligible." He added that physical prices rose USD 0.50 last week in anticipation of the strike, which started at the weekend.
The German trader said that most South African coal companies have stock to work through. Stocks at the main Richards Bay port terminal are around 3 million tonnes, agreeing the mines themselves held plenty of stock and transport links have not been affected by the strike action. He said that "The situation could get critical after two weeks."
An Iberian trader said that "I think it would have more impact if the strike continues, and China and India start buying." She added that however, there is currently little demand in Europe and very little activity during the summer holiday period in July and August.
She said that coal is currently very correlated with range bound German power and emissions, with no strong coal fundamentals that could move the curve. While the market is flat as a pancake at the moment, attention is being paid to fluctuations in the euro/dollar rate, with a weaker dollar the main reason for a rise in API 2 Cal 12 coal above USD 128 per tonne at the end of last week.
The German trader said that the contract should remain range bound between USD 127 to USD 129 per tonne.
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European coal prices have been mostly unaffected by an ongoing strike by South African miners, as stockpiles are healthy and demand low.
A German utility trader said that "At the moment, the impact is negligible." He added that physical prices rose USD 0.50 last week in anticipation of the strike, which started at the weekend.
The German trader said that most South African coal companies have stock to work through. Stocks at the main Richards Bay port terminal are around 3 million tonnes, agreeing the mines themselves held plenty of stock and transport links have not been affected by the strike action. He said that "The situation could get critical after two weeks."
An Iberian trader said that "I think it would have more impact if the strike continues, and China and India start buying." She added that however, there is currently little demand in Europe and very little activity during the summer holiday period in July and August.
She said that coal is currently very correlated with range bound German power and emissions, with no strong coal fundamentals that could move the curve. While the market is flat as a pancake at the moment, attention is being paid to fluctuations in the euro/dollar rate, with a weaker dollar the main reason for a rise in API 2 Cal 12 coal above USD 128 per tonne at the end of last week.
The German trader said that the contract should remain range bound between USD 127 to USD 129 per tonne.
If you believe an article violates your rights or the rights of others, please contact us.
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