China's portside thermal coal prices remained stable but the market cautioned the consistent mismatch between supply and demand would drive the prices down.

On March 31, 5,000 Kcal/kg NAR coal continued to be the preferred option at northern ports, with most offerings unchanged, hovering at 920-925 yuan/t FOB with VAT for the high-sulfur and 935-940 yuan/t for the low-sulfur.

A Tianjin-based trader reported a demand for 50,000 tonnes of 5,000 Kcal/kg NAR cargo with 1.0% sulfur at 925 yuan/t FOB, to be loaded in 3-4 days.

A South China-based utility purchased a 5,000 Kcal/kg NAR cargo at 925 yuan/t on March 30. The utility was still seeking another cargo of this grade, with a Fujian-based trader ready to sell at 923 yuan/t.

For 5,500 Kcal/kg NAR grade, the situation of "no inquiries due to less competitive prices" was still in place as the cost remained elevated. A Hebei-based trader expressed difficulty in stocking up Shaanxi 5,500 Kcal/kg NAR coal at prices lower than 1,090 yuan/t. Most offer/bid prices for the low-sulfur were around 1,080-1,090 yuan/t.

The 4,500 Kcal/kg NAR grade saw a deal done at 810 yuan/t FOB today.

While some traders expected the upcoming Daqin railway maintenance to provide support into early April, which will lead to a decline from 1.25 million to 1.0 million tonnes in its daily railings to northern ports, buyers seemed not to be bothered as they haven't yet cranked up the buying activity.

Currently, coastal power plants have stocks enough to use for more than 16 days of use.

Concerns over fundamentals loosening are spreading among traders, prompting speculations that CHN Energy, or Shenhua, will soon cut its purchase prices. The top producer has kept its purchasing prices unchanged for four weeks in a row.

On March 31, 5,500 Kcal/kg NAR thermal coal traded at Qinhuangdao port was assessed at 1,080 yuan/t FOB with VAT, flat from a day ago. The 5,000 Kcal/kg NAR grade was at 935 yuan/t, unchanged, while the 4,500 Kcal/kg NAR grade was at 815 yuan/t, up 6 yuan/t from a day ago.

Indonesian market facing mixed supply situations

Indonesian low-CV thermal coal prices are facing downward pressure, which are easily available in the market, even for prompt cargoes, while the mid-CV segment struck a balance between supply and demand, according to traders.

Supply of 3,800 Kcal/kg NAR and below has been sufficient as production can keep pace with schedule due to good weather.

With easy availability, Chinese buyers gave aggressive bids, with an Indonesian miner receiving bids around $70/t FOB for Supramax 3,800 Kcal/kg NAR. The source also reported some bids no less than $72/t for Panamax cargoes of this grade.

Offers for Panamaxes were still at $77/t FOB from large mines in Indonesia, a Fujian-based trader said.

Supply for mid-CV cargoes was relatively tight, partly because many cargoes are covered by long-term contracts and squeeze flows into the spot market.  

China's demand for mid-CV coal was good, with the buying interest at $96-97/t or a $3-3.5/t premium to index.

Traders predicted mixed trends for the market direction, with prices of 3,800 Kcal/kg NAR and below facing downside pressure but prices of above 3,800 Kcal/kg NAR coal are likely to maintain stable or even rise slightly.

On March 31, Fenwei assessed Indonesian 3,800 Kcal/kg NAR thermal coal at $85.5/t CFR South China, flat from a day ago; on a FOB basis, this grade was assessed at $75/t, also unchanged.

Indonesian 4,700 Kcal/kg NAR thermal coal were assessed at $110.5/t CFR, and the FOB price for this grade was assessed at $102.5/t, both unchanged day on day.