Thermal coal prices remained stable at northern transfer ports in China, with most transactions aligning with the CCI Indexes and cautious buying practices limiting high-priced deals.

On October 23, the CCI index for 5,500 Kcal/kg NAR thermal coal traded at Qinhuangdao port was assessed by Sxcoal at 858 yuan/t and 5,000 Kcal/kg NAR grade at 758 yuan/t FOB with VAT, both unchanged day on day. The index for 4,500 Kcal/kg NAR grade also stood flat at 665 yuan/t.

"There were still inquiries for thermal coal, mainly for essential demand and to cover short positions, but finding prices below the indexes is challenging as sellers are largely holding firm," said one trader source in northern China.

Spot prices were little changed compared with the previous two days, but transactions, though still subdued, occurred at lower ranges.

While offers of 5,000 Kcal/kg NAR coal stood mostly between 755-765 yuan/t FOB northern ports, several trades were heard at about 760 yuan/t, with difficulties in reaching deals at higher prices.

A cargo of 1%-sulfur 5,000 Kcal/kg NAR Shanxi coal changed hand at 763 yuan/t, while another trade for 0.85%-sulfur same-CV blended coal settled at 760 yuan/t, according to sources.

Port liquidities remained constrained due to the persistent bid-ask spread. One source offered 0.5%-sulfur 5,500 Kcal/kg NAR coal at 870 yuan/t, while buying indications received were about 10 yuan/t lower.

One miner source reported difficulties in selling 4,500 Kcal/kg NAR Shanxi coal at 675 yuan/t, while offers ranged from 665-675 yuan/t.

Sellers generally resisted to lower prices due to high costs, which made it still economically unviable to transport new cargoes to port for selling at current levels. Expectations of rebounding coal burns at power plants in northern areas also arrested attempts for any significant downward corrections.

Part of northern regions in China has entered the winter heating season following a wave of rainfalls that significantly brought down temperatures, with increasing families already receiving warmth from heating companies. North China typically enters winter heating season in November.

This has increased coal consumption at certain northern power plants. Data showed the average coal burns at power plants in northern China stood at 3.17 million tonnes on October 21, rebounding 0.9% week on week, although it remained 9.2% lower compared with the month-ago level.

Some sources reported slightly better trades at ports along the Yangtze River, partly due to higher inquiries from non-power users, including the cement producers. The cold spell hindered construction in the northern provinces, while warmer temperatures are conducive in the south.

Trader bids unchanged for seaborne low-CV coal

Chinese traders' bidding prices to domestic utility tenders for Indonesian 3,800 Kcal/kg NAR coal remained relatively resilient compared with the preceding week, mostly around 500 yuan/t CFR China with VAT for Panamax cargoes with November laycan.

That translates to about $54.5/t FOB Kalimantan, still falling below offering levels at $55-56/t FOB from Indonesian sellers, making traders hard to procure new cargoes profitably.

A buying indication for Supramax cargo of October-delivery 4,200 Kcal/kg GAR coal was heard at $52.5/t, while an offer of same vessel same-CV coal with November laycan reportedly stood at $53/t.

Traders foresaw a lack of downside pressure due to high offer prices and rebounding coal consumption at power plants. The stabilization of domestic coal prices also injected optimism into the import coal market, as seaborne cargoes maintained competitive price over domestic sources.

Supply from Indonesia was little affected amid weaker-than-expected rainfalls, although some low-stocked miners were reportedly withholding stocks in anticipation of higher bids, sources said.