Australian coal producers have budged first in the standoff pitching them against Asian buyers, with lower offers seen in the premium 6,000 kcal/kg NAR Newcastle coal market Thursday, said traders.
However, the move down did not translate into the 5,500 kcal/kg NAR thermal coal market as value was unchanged on the day.
A November-loading cargo of 6,000 kcal/kg NAR thermal coal was heard offered at $79.50/mt FOB Newcastle through globalCOAL in the Asian afternoon, the level where a bid was registered Wednesday and indicating lower value on the day. An offer for December-loading coal was also lowered by 25 cents to $85/mt while January was heard offered at $87/mt.
Traders continued to describe a largely quiet market as Chinese and other Asian buyers wait before committing to any new purchases.
One broker put the amount of transactions for Australian 5,500 kcal/kg NAR thermal coal at one or two this week, well below what traders had expected going into this week.
"The Chinese still ask for a very low price, which is not doable...they are just testing the market and can afford to wait," said one Asia Pacific market participant.
"There's still a bit of an oversupply in China...it is the same situation for South Korea and Taiwan and I believe they could even resell coal to China," he added.
Offer levels for Australian 5,500 kcal/kg NAR thermal coal with maximum ash of 23% loading in November were pegged by broker Marex Spectron at $70.50-72.25/mt, showing little change from Wednesday.
One trader said tradeable value was likely closer to the bid.
Q1 2013 was bid at $73.25/mt, a source at Marex Spectron said.
Freight costs from Newcastle in eastern Australia to Southern Chinese ports were still around $12.00-12.50/mt, marking a climbdown from late last week, said traders.
The price for 7-45 day forward Australian 5,500 kcal/kg NAR thermal coal with typical ash of 20% was assessed at $71.55/mt FOB Newcastle, unchanged from Wednesday's assessment.
The ash differential was also assessed unchanged on the day, at $0.68/mt.
