China thermal coal price stable despite sea ice and int’l price hike

Jan 28, 2011

China's benchmark thermal coal price remained stable during January 19 to January 25 despite of the turbulence of sea ice and international price hike.
According to statistics released by Ocean Shipping Coal, China's benchmark thermal coal price averaged 774 yuan/tonne, up only one yuan from previous week. China's coal price remains in a downward trend which began since Dec 8 of 2010.
By January 16, the free on board (FOB) price for power coal at New Castle Port in Australia has jumped 4.9% on week to US$1 36.3/tonne, and that of coking coal up 5.7% to US$280/tonne.
Bohai has been covered by ice, which is supposed to block coal imports of China and further push up domestic coal price.
However, the international coal price hike and the bad weather seemed to pose little impact in China's domestic coal price.
The stability in coal price in China despite of international price hike is mainly attributed to smooth throughput at major ports in north China, which has effectively guaranteed stable coal supply to south China.

Experts forecast that coal supply and demand in coastal market will maintain flourish until the Chinese Spring Festival in February, and power plants would have stable coal supply if the weather will not deteriorate into a substantial hinder to disrupt coal transportation from northern coal producing provinces to major coal consumers in the south.

But considering the approaching of Chinese Spring Festival on February 3, China may have to face mounting transportation in railways, which may affect coal transportation. Therefore, insiders predicted that China's coal price is very likely to maintain at high level and grow up further in February. (sourced:Xinhua)

China coking coal price to see leaps despite stable power coal price

Thursday, January 27, 2011
BEIJING,(Xinhua News Agency)

China domestic coal price ha s been capped stable while coking coal price kept surging following th e international coking coal price hike. Experts predict that China's c oking coal price is likely to see the second uptrend of this year in March or April.
The National Development and Reform Commission (NDRC), China's top economic planner, only capped the price for contracted coal for 2011, but the pricing of spot coal, coking coal, and coke are fully market-oriented.

Since the beginning of this year, China's coke producers like Shanxi Xishan Coal and Electricity Power Co., Ltd (000983.SZ) and Guizhou Panjiang Refined Coal Co., Ltd (600395.SH) have raised coke price at least by 100 yuan/tonne.
It is learned that the flood in Australia has severely blocked coking coal supply to global market. Spot coke price of Australi a has exceeded 300 US dollars/tonnes, and is expected to reach 400 US dollars/tonne, hitting a new high since 2008.

On the coming of spring, China's domestic steel productio n will return to full operation, plus the peak demand for steel, cokin g coal demand would accordingly witness rapid growth at that time.
China's domestic steel makers are looking for alternative supply of coking coke. They have shown that they would increase purch ase of coking coal in domestic market if coking coal imports could not be guaranteed. In this sense, China's coking coal price is likely to hike again within a range of 100-150 yuan/tonne.

Besides, China International Capital Corp. noted that tim e is needed for Australia, the major coal expertor in the world, to re sume normal coal production and transportation. As the Oceanic country will enter rainy season soon, which usually an off season of coal pro duction, the international coking coal price would go even higher, resulting in more hikes of China's domestic coking coal price. (sourced:xinhua.org)