According to one broker, coal prices are gathering some strength on Friday as players step in to secure favorably priced material while offers are limited. In the API 2 window, the front quarter contract gained USD 1 to a last trade of USD 122 per tonne while the Cal 12 contract last changed hands at USD 127.50 per tonne up by USD 1.15 on Thursday’s close,

A London based coal broker said that “I think the drop [over the past week] has given people a few ideas about getting in some cheaper coal.” On the physical side, trading on the Global Coal screen has also been quite active this morning. A July free on board Richards Bay stem was last placed at USD 118 per tonne up by USD 1 from a deal for the same month settled earlier in the session, while a September consignment traded at USD 119 per tonne. At the same time, a July loading cargo for delivery in Europe traded at USD 119.75 per tonne up by USD 0.75 from a similar trade on Thursday.

One Geneva-based coal trader said that “I don’t think it’s anything structural. We went down quite a lot and now we go up a bit. It’s difficult to get too excited.” But a UK-based trading firm which has been actively offering supplies over the past few days is heard to be standing back from the market, thereby allowing prices to rise again, players said. [The firm] has stopped selling.”

A coal trader that “They’ve been holding the market for some time. They must be massively short.”

(Sourced from Montel)