US over-the-counter thermal coal prices closed mostly lower on Thursday, despite the sharp jump in the broader energy complex, led by a 5.6% increase in the front-month natural gas futures price to $4.762/MMBtu.
"Coal is marching to its own beat," said a market source, as Central Appalachian and Powder River Basin thermal coal prices closed little changed, despite the latest weekly natural gas injection data coming in below analyst expectations, lifting the prompt month natural gas futures price to a five-week high.
At the front of the curve, CAPP rail (CSX) physical July was unchanged at $59.50/st, CAPP barge July closed 25 cents/st lower to $59.25/st, and Powder River Basin 8,800-Btu/lb July physical fell 5 cents/st to $13.10/st.
Despite the sharp one-day increase in the natural gas futures market, energy research firm Global Hunter Securities said that prices could retrace.
"We continue to see that the natgas trading story is coiled up for a move higher, challenging the key $4.75 MMBtu level, or the chart could breakdown to visit a longer-term retracement level near $4.130 MMBtu," said GHS, in a report released shortly after the EIA natural gas inventory data.
"We are biased in favor of a move higher, and that despite moderating temperature forecasts the situation for natgas is intensely entangled into and out of coal's very low inventory situation," GHS said.
In Thursday's OTC US coal trading session, three spot month physical deals were done, but most of the day's volume was seen in the Q3 2014 and Q4 2014 terms.
