Thermal coal prices across China's key mining hubs experienced both ups and downs ranging from 5 to 20 yuan/t on December 24, yet lacked a strong catalyst for substantial movements in either direction, given weak supply-demand dynamics.

Of the 90 coal mines surveyed by Sxcoal on December 24, seven mines raised prices by an average of 11.86 yuan/t, while seven mines lowered prices by 19.86 yuan/t on average. The remaining 76 mines kept prices stable.

Market bearishness alleviated after a leading Chinese miner held third-party coal buy prices steady. Several mines, particularly those offering cost-effective slack and lump cargoes, reported slightly increased sales, thereby spurring about 5-10 yuan/t price gains.

"Downstream buyers have started to place orders, helping digest our inventories," a miner source in Shanxi's Shuozhou pointed out. Trading activity also warmed up in Shaanxi's Yulin, pushing prices for 6,000 Kcal/kg NAR slack coal (S 0.5%) by 5 yuan/t to 505 yuan/t, mine-mouth with VAT. A few lump grades also climbed 10 yuan/t thanks to continued buys from chemical plants.

Meanwhile, an increasing number of mines have completed annual production targets as the year draws to a close, subsequently halting or cutting output. This, combined with potentially heightened safety inspections following a water inrush accident in Heilongjiang, favored a bullish stance among participants. A Zhunger-based miner raised prices for chemical-purpose 5,200 Kcal/kg NAR raw coal (S 1%) by 20 yuan/t to 446 yuan/t, mine-mouth with VAT, citing regional supply contractions and unchanged buy prices from the top miner.

While supply-side constraints offered minor support in certain regions, the demand side revealed core weakness, capping substantial rallies. Traders and washing plants still adopted a wait-and-see approach, making only select purchases. Moreover, persistently elevated inventories and sustained price drops at northern ports cast a long shadow over buying enthusiasm from railway station-based traders. This added to sales pressure at mines.

The fundamental driver, power generation demand, offered little hope for a rebound. Coal burns at power plants under six coastal power groups hovered at around 800,000 tonnes, down more than 7% from a year earlier, Sxcoal data showed. Major inland power plants also represented about 7% yearly decrease in daily coal consumption.

A milder winter suppressed residential heating demand, and strong output from renewable sources further limited the call on thermal power. With fuel stockpiles at inland power plants sufficient for over 25 days of usage, generators saw no urgency for large-volume purchases for spot supplies, as long-term contract coal could fulfill basic needs.

Restocking from non-power sectors was just sufficient to cover immediate needs, failing to provide additional market impetus.

Consequently, some miners still suffered from unsmooth offtakes and minor price reductions. Zhunger-sourced 5,800 Kcal/kg NAR raw coal (S 0.2%) declined by 10 yuan/t to 530 yuan/t, mine-mouth with VAT. "Cautious sentiment persists, with scarce procurement and transportation demand from end users, moderating mine sales," a local miner source noted.

In addition, meteorological forecasts for the next ten days predict above-average temperatures across most parts of China, dashing hopes for a significant, demand-boosting cold spell. A surge in power plant coal consumption and concentrated restocking seems highly unlikely, which may keep mine-mouth prices range-bound in the coming days.

On December 24, Sxcoal assessed Datong 5,500 Kcal/kg NAR coal at 555 yuan/t, unchanged day on day, and Ordos 5,500 Kcal/kg NAR material was also unchanged at 527 yuan/t. Yulin 5,800 Kcal/kg NAR grade dipped 1 yuan/t from the previous day to 573 yuan/t.