EUROPE THERMAL COAL: Market slips, CIF ARA Sept trades $88.75/mt
Tuesday, 10 July 2012 | 16:30
Prompt thermal coal delivered into northwest Europe traded back below $90/mt early Tuesday, as oversupply continues to dominate the CIF ARA market.
A 50,000 mt September DES Amsterdam-Rotterdam generic cargo with exchange of futures for physical terms attached was given at $88.75/mt on the globalCOAL trading platform, 75 cents below overnight levels.
The last reported spot CIF ARA transaction, also for September, was done Friday at $90.25/mt.
A northern European utility source said he believed European prices had bottomed out at just under $85/mt last month, and attributed the recent firming to over $90/mt to a run of short-covering.
"The market has been yo-yoing back and forth between $84.50 and $90," he said, adding that he expected more rangebound trading to come.
Stock levels at the OBA coal discharge terminal in Amsterdam are around 2.3 million mt, slightly down from 2.4 million mt a week earlier, according to a source close to the terminal.
Traders said that despite healthy coal consumption in Europe, strong supply from the US and Colombia has dampened spot prices. The utility source said that although the falling prices may be cutting supplies from the US East Coast, the reduction in exports would be gradual and unlikely to cause any spike in prices.
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