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Asia's coal markets tighten on Indonesia port probe, Australian cyclone

Published 29/03/2017, 05:32 pm
© Reuters.  Asia's coal markets tighten on Indonesia port probe, Australian cyclone
GLEN
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* North Asia demand strong as Asia/Pacific output stalls

* Graft probes in East Kalimantan trigger long port delays

* Cyclone Debbie shuts some Australian coal mines

* North Asia sucks in coal from as far away as U.S., Colombia

* European demand weak as spring starts with mild weather

By Henning Gloystein

SINGAPORE, March 29 (Reuters) - Port disruptions in Indonesia and a cyclone hitting mines in Australia have tightened Asia's coal markets in March, while demand in China and other key import markets remains strong, lifting prices.

Prompt thermal coal cargo prices for export from Australia's Newcastle port GCLNWCPFBMc1 have risen by more than 11 percent since March 10, partly reversing a steep decline since last November.

The price jump has been driven mainly by an Indonesian government graft probe at ports in its East Kalimantan province, which is one of the world's most important thermal coal export hubs. probes have disrupted ship loadings around the port of Samarinda, where 38 large dry-bulk ships are currently sitting idle to take on coal, according to shipping data in Thomson Reuters Eikon, with some vessels waiting for a month.

Most ships are unable to berth at the port and are being forced to take on coal via a small number of loading vessels.

"The situation there is bad. Ships rely on just a couple of seaborne loading vessels to do the job of the entire port," one coal shipper affected by the situation said, asking not to be named as he was not authorisied to speak to media.

The delays come as demand remains strong in China, by far the world's biggest coal consumer, after a crackdown on mining led to a 1.7 percent year-on-year drop in domestic output in the first two months of the year. cyclone this week in northeast Australia, China's biggest coal supplier, added to concerns over tight supplies.

Cyclone Debbie missed most of the region's mines, but Glencore GLEN.L halted operations at its Collinsville and Newlands mines, and coal carriers stopped heading north for several days, delaying shipments. higher Asian prices have led to a pickup in shipments from the United States and Colombia as traders take advantage of cheap Atlantic basin coal, with prices there dipping due to an unusually mild start to the low demand spring season.

The Amsterdam, Rotterdam and Antwerp (ARA) benchmark has fallen by over 5 percent since March 10, putting it an $8.40 per tonne discount to Australia's Newcastle price of about $80.90.

Five South Korean utilities jointly bought a total of 1.5 million tonnes of coal from the United States to arrive from the third quarter, a spokesman at one utility said this week, marking one of the largest U.S. coal shipments to Korea on record, according to Eikon data. data also shows an increase in Colombian coal exports to Asia, with shipments to its top buyers Japan, China and South Korea totalling almost 1 million tonnes in March, the highest level in a year.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Interactive Map of Kalimantan shipping queues

reuters://REALTIME/verb=Interactive%20Map/context=%3CNavigation%3E%3CEntities%3E%3CEntity%20type= 'archive'%3E%3CIMap%3EFQMAAB+LCAAAAAAABACNU11rgzAUfR/sP4S8r/Gztk OFVhg4WtjUfb4FvW1l1kgSC33Yf1/UjqqU0pd8HM4599xL4oalBE5TmR9gTSt0AC 5yVnpYx76rgHZJKN+C/GZs7+u6S4bImRBA44U+lVh3JvbUNBzNdjD68vCDNjF1x7 Dmho0RaTVrloFvtG7t0f3gtFpwVpeZn/AaXNID3BU9qmSnHSXHCjz8JoCvciFV0j BTtfNN3nDu7xDqAaikexAVTZUiCgPsB79J7Jja3LZM3VbtnKk3S6fWVJtZI2n/qp KSNuow8bIufoC/gxBQCBU7YOUm39acSjVz340llbWIGJOqIwn7bkUd7OEnqnpFMR SQSsiaeyGgHSfp2KRv0FVp6p4NURTESvdohHgEPI+B18uVBpzoapoBNb7BLrne3L ghMprepYG/MC6XwOVuUaY7xun2ZPn/nEj7xMnwE/h/s+I0CRUDAAA=%3C/IMap%3 E%3C/Entity%3E%3C/Entities%3E%3C/Navigation%3E MAP: Ships waiting to load coal at Samarinda

http://tmsnrt.rs/2nz47WH MAP-Cyclone Debbie hits Australia

http://tmsnrt.rs/2nVoDC1 CHART-South Korean imports of U.S. thermal coal

http://tmsnrt.rs/2npcCSC

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