ASIA COAL-Weak China demand drives down thermal price
SYDNEY Feb 14 (Reuters) - Weak demand from Chinese power companies drove Australian thermal coal export prices to a five-month low this week, with ample inventories on hand expected to further cap sales.
The Newcastle weekly spot index fell to $77.73 a tonne from $80.01 on Feb. 7.
The index, tracking prices from the world's top thermal coal exporting terminal, has been in steady decline over the past seven weeks, dropping by 10 percent since Dec. 20.
Sam Walsh, chief executive of Rio Tinto , one of Australia's biggest coal miners, late Thursday told reporters thermal coal markets "remained a problem" for the company as it wrestles lower production costs amid weak conditions.
Trade sources said a return to a full-work schedule this week following the Lunar New Year holidays across most of Asia failed to generate much fresh interest among buyers, who were more apt to work off stockpiles accumulated before the break.
SHIFT FROM COAL
Guangdong, a major industrial province in southern China, is looking to use "cleaner" energies in the future, according to ANZ Bank.
The province is targeting 36.2 percent of its energy demand to be met by thermal power, down by 6 percent from 2010, it said.
The gap in demand is expected to be met with a combination of hydro, wind and nuclear power. China's nuclear usage rose to an 8-year high of 7,893 nuclear power units in 2013.
The average price of steam coal in China ended at 571 yuan ($94.17) per tonne this week. This was a decrease of 13 yuan ($2.14) per tonne versus the previous weekly reporting period, according to the Bohai Rim index, which tracks thermal coal prices at six ports.
In coking coal, China's major producers were lowering prices to address weakening demand, in sharp contrast to the resilience in the market seen around the same time last year, sources familiar with the sector said.
- Israel pummels Gaza; Kerry steps up diplomatic push |
- With sales sputtering, Apple's iPad looks to IBM alliance
- Ukraine war crimes trials a step closer after Red Cross assessment
- Rebels likely downed Malaysian jet 'by mistake': U.S. officials
- Five held in China food scandal probe, including head of Shanghai Husi Food