China's portside thermal coal prices showed signs of bottoming out on November 30, following days of drops earlier this week, thanks to increased inquiries.

 

Offer prices remained broadly unchanged, but more traders held back on sales in anticipation of price rebound in the days ahead.

 

During the session, cargoes of 5,500 Kcal/kg NAR coal were mainly offered at 930-940 yuan/t FOB with VAT at northern ports, yet a few high-quality ones were quoted higher at 950 yuan/t. Offers for 5,000 Kcal/kg NAR grade stood at 820-840 yuan/t FOB, and 4,500 Kcal/kg NAR at 720 yuan/t.

 

Some deals were reportedly concluded on 5,000 Kcal/kg NAR coal, with one 4,000-tonne cargo with 0.7% sulfur sold at 825 yuan/t, one 0.6%-sulfur cargo done at 830 yuan/t and a 0.8%-sulfur Inner Mongolia shipment at 826 yuan/t, according to traders.

 

End buyers stepped up inquiries in the spot market, although most of them remained aggressive in prices. A Zhejiang-based trader noted buying interest was scarce when prices exceed 820 yuan/t.

 

A Shanix-based trader offered 5,500 Kcal/kg NAR coal at 940 yuan/t, while several bids received were around 920 yuan/t, making it hard to go on with the negotiation.

 

Stockpiles data substantiated the emerging buying appetites in the market, showing a downward trend at both northern ports and coastal utilities. Currently, coal stocks at coastal utilities declined to less than 19 days' worth of consumption.

 

In the next three days, temperatures in southern China provinces are forecast to plunge, down 8-10 degrees Celsius in part of places in Guangdong, Guangxi and Jiangxi, China's central metrological center said.

 

Meanwhile, the center issued an alert on gales from November 30 to early December 1 at seas in the east and south, potentially affecting vessel handling at ports.

 

Some traders also highlighted stricter safety inspections, which would spur the speculative sentiment. 

 

A safety meeting chaired by Deputy Premier Zhang Guoqing on November in Beijing highlighted risk management in coal and other mining sectors, drawing lessons from the recent fatal accident in Shanxi. This would likely prompt local authorities to maintain strict inspections in the following month of the year.

 

On November 30, the CCI index for domestic 5,500 Kcal/kg NAR coal traded at Qinhuangdao port was at 933 yuan/t FOB with VAT, up 3 yuan/t from a day ago; 5,000 Kcal/kg NAR coal at 817 yuan/t and that for 4,500 Kcal/kg NAR at 715 yuan/t, both up 3 yuan/t on the day.

 

In key production areas, mixed trends were observed. Coal prices remained largely stable in Yulin, Shaanxi, while a few mines lowered prices by 10-15 yuan/t. Online auctions also registered abortions.

 

Ordos in Inner Mongolia saw prices fall by 5-15 yuan/t. Many local mines suspended production after completing monthly targets ahead of schedule, but this was eclipsed by waned demand from local end users and train station-based traders.

 

In northern Shanxi, prices increased amid frequent safety checks. Some private mines have suspended as a result, leading to tight supply in the region.