China Coal Falls to Lowest in 2022 as Indonesia Releases Cargoes
(Bloomberg) -- Chinese coal futures fell to the lowest level this year after Indonesia allowed some cargoes to leave ports as it considers lifting a temporary ban on exports of the fuel.
Thermal coal on the Zhengzhou Commodity Exchange dropped by as much as 2.9% Tuesday after Indonesia’s government said the previous day that it would immediately release 14 ships fully loaded with coal that’s already been paid for by buyers. It said it will decide Wednesday whether to broadly resume exports after halting them Jan. 1 to ensure supplies for domestic power plants.
“No more export ban means that the Indonesia coal miners should resume normal activity,” Justian Rama, a Citigroup Inc. analyst in Jakarta, said in a note. “There could be some retreat or weakness in the coal price.”
The seaborne thermal coal market has been in disarray since Indonesia, the world’s biggest exporter, announced it would halt exports for January so it could replenish stockpiles at fuel-starved power plants. Local miners have warned of possible force majeures, some Chinese buyers have tried to cancel deals, while Japan and the Philippines have asked Jakarta to remove the ban.
China is the world’s largest coal user and the top importer from Indonesia. Its benchmark coal futures dropped 2.7% to 681.4 yuan a ton as of 1:50 p.m, in Shanghai on Tuesday. They reached 680 yuan earlier, the least since Dec. 31.
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