China's portside thermal coal prices were generally unchanged amid limited trading liquidity during the week-long holiday of Chinese Lunar New Year, but there's a downward risk in the wake of continuous declines in the global market.

On January 28, prevailing offers for 5,000 Kcal/kg NAR thermal coal at northern ports stood at 1,210-1,220 yuan/t FOB with VAT, almost unchanged from the pre-holiday level, while 5,000 Kcal/kg NAR coal was mainly offered around 1,080 yuan/t, also unchanged.

Trading activity was thin at the first day after the holiday. Some utilities showed buying interest but placed their prices at quite low levels. A Fujian-based trader reported a bid from a utility at 1,045 yuan/t for 5,000 Kcal/kg NAR coal.

"With high-level stockpiles, utilities are not in a rush to restock," he commented.

A Jiangsu-based trader was ready to book two cargoes from northern ports after locking sales to an end user, with its intended price at 1,200 yuan/t FOB for 5,500 Kcal/kg NAR coal.

"The market is in a 'wait-and-watch' mode now and may start to turn active from next week. Now the downstream is pushing prices down hard," he added.

Coal stockpiles have accumulated at northern ports during the holiday, which traders took as a key factor to drive the prices down in the near term. Some traders were ready to destock in the next few days.

As of January 28, coal stocks at Qinhuangdao totaled 6.1 million tonnes, compared with 5.86 million tonnes on January 20. The stock-building came with stable rail inflows plus reduced outflows.

Daqin line's daily shipments from mines to northern ports were maintained at a high level of 1.18 million tonnes averagely during the holiday, while coastal end users preferred cheaper imported cargoes rather than sending vessels to northern ports. One source noted Indonesian 3,800 Kcal/kg NAR was about 60-70 yuan/t cheaper than comparable Chinese spot cargoes.

Coal consumption maintained largely stable at power plants during the holiday. A slump in temperature during the holiday ramped up heating demand, but this was offset by weak industrial consumption.

Some utilities reported a small increase in coal consumption, but this didn't push them to scramble for spot coal at ports.

As for supply, a lot of coal mines are expected to start operation from January 30, the eighth day in the lunar calendar. But, usually, large-scale recovery may appear after the Lantern Festival on February 5.

The global market saw price plummet during the Chinese holiday, mainly owing to factors including reduced demand from Europe and eased concerns on supply.

The February contract of Newcastle thermal coal on the ICE kept falling for six days in a row to close at $253.25/t on January 25, down from $326.5/t on January 18.