* Australian coal prices softer in thin trading
* Chinese buyers show some interest for cargoes next year
* Tepco in annual contract talks with Australian suppliers
By Rebekah Kebede
PERTH, Dec 16 Australia's thermal coal
prices, the benchmark for Asia, slipped to around $110 per tonne
in thin trading, although Chinese buyers were reportedly in the
market for some cargoes next year.
Thermal coal on the global COAL Newcastle index for the week
to date closed at $110.20 per tonne on Thursday, down from
$111.47 per tonne a week earlier.
Despite the lower prices, there were reports that supplies
from Australia's Newcastle port were a little tight for very
prompt delivery, likely due to some producers overselling for
December and January.
Australian thermal coal shipments from Newcastle port rose
34 percent in the week ended Dec. 12 to 2.58 million tonnes,
while the vessel queue increased to 20 ships from 12 as some
producers rushed to send out a few extra cargoes by the
Chinese import demand for next year was seen picking up,
although sources said buyers were still not committing to large
"It seems like we've seen a little timid term interest come
from China," one Sydney-based trade source said.
In China, the domestic coal price benchmark was slightly
lower at 830 yuan ($130) per tonne last week from 840 yuan the
previous week, according to the weekly Bohai-Rim Bay thermal
coal price index published Wednesday.
Chinese import demand typically ramps up when domestic
prices climb above the cost of importing coal.
China's coal supply will be "basically balanced" with demand
in 2012, the National Development and Reform Commission said in
a document published on Thursday.
Utilities from Japan, Australia's number one coal buyer, and
Australian suppliers Xstrata and Anglo American
continued to negotiate for the annual coal contract beginning
Buyers were said to have put an offer below $110 per tonne
on the table, with suppliers holding out for $120 per tonne.
Tokyo Electric Power Co. (TEPCO) is back in the lead
negotiator position, after ceding to Chugoku Electric and Tohoku
Electric in the negotiations immediately following the
March earthquake as it struggled to deal with the Fukushima
The 2011 benchmark annual contract starting April 1, which
represents most of the long-term coal volumes imported during
the year, was settled at a record of $129.85 per tonne, while a
smaller annual contract beginning in October was settled at
$126.50 a tonne.
The January thermal coal supply contract typically
represents about 10 to 15 percent of Japan's annual imports,
according to industry sources.
($1 = 6.3735 Chinese yuan)
(Editing by Sugita Katyal)