Coal news and updates

US OTC thermal coal markets see light trading as November expiry nears

Trading remained light in the US over-the-counter thermal coal markets Thursday, with only a pair of physical deals and some financial activity on the second to last day of the November contract as the front month.

The Powder River Basin 8,800 Btu/lb November physical contract traded at $11/st for two trains (30,000 st), which was then followed by a $10.90/st bid, a market participant said.

The contract had traded at $11.05/st Wednesday and has traded six times since Friday, when it traded twice at $11.25/st.

"We were a little bit surprised to see [November 8,800 Btu/lb] trade down because it had been on a nice trajectory," a trader said. "But when you get to the end of the month and a trader has to get rid of it, you will see that train getting bids."

Platts assessed the contract price at $11/st, up 5 cents from Wednesday, based on the physical deal.

Another market source said he expects a bid or two Friday for November PRB 8,800, which could sell again at roughly the same level or lower.

The PRB 8,800 Q1 2016 financial contract traded for five contracts (15,000 st) at $11/st. Additionally, the PRB 8,400 Btu/lb November contract was bid at $8.70/st, the second source said.

The Central Appalachia rail (CSX) contract, which has been trading at multi-year lows this month as buyer demand has dried up, has been "fairly balanced" this week, the trader said.

"The CSX traded at its lowest point and it's been trying to come off those lows," he said. "At least for the time being, it's fairly balanced between $36.50 and $37."

The CSX November physical contract traded at $36.50/st for one train (11,000 st). The contract had last traded at the same level on October 15.

Platts assessed the November contract at $36.50/st, down 50 cents from Wednesday, based on the physical deal.

The CSX Q4 2016 financial contract also traded four times. Three of those trades were for a total of 55 contracts (165,000 st) at $44.50/st. The CSX Q4 2016 contract later traded for five contracts (15,000 st) at $44.35/st.

The front-month CAPP barge contract, which has not traded since October 13 at $42.05/st, again was quiet Thursday.

Platts assessed the contract price at $41.95/st, down 5 cents from Wednesday, based on the midpoint of broker marks.

source: http://www.platts.com