Market overview from globalCoal for December 13

A continued lack of market confidence over Eurozone debt, coupled with the seasonal lack of appetite to take on new risk/positions have resulted in the coal market slowly fizzling out for the year. The financial market ticked off around $0.25 on the benchmark Cal 12 contracts across the three main indices while the physical market remains range-bound with the DES ARA hub heard trading broadly flat to previous markings for Feb 12. Conversely, front-month Brent crude gained $1.85 to end the day (@ 17:00) at ~$109.20/bbl.

Further declines in the physical market in Asia with the best bid/offer for March Newcastle down almost $0.40 from yesterday. Major Chinese utilities have lowered their price expectations. We heard that one of the top utilities is only willing to bid 780 RMB, slightly below the 800 RMB cap imposed by NDRC for the 5500NAR material. Besides waiting to see the effect of the price cap after it is implemented on 1st Jan, end-users are also not in a hurry to buy as they are well placed with high stock levels till early next year. There is also abundance of coal at major Chinese ports to draw on. (*)

globalCoal trades this week

	Product	Expiry	Price	Volume	Origin	Delivery Point	EFP
12/12/2011	Phys ARA (DES)	Jan'12	$ 111.25	50000	ACPRS	Amst	EFP