China’s second largest coal producer China National coal group has increased discounts on medium-to-high sulphur thermal coal, in the hope of boosting sales amid intensifying competitions.<br /> <br /> The group now offers a 15 yuan/t discount for every 0.1 percentage point increase in sulphur between 1.5% and 1.8%, up from 5 yuan/t, and 20 yuan/t for sulphur above 1.8%, up from 10 yuan/t, sources confirmed.<br /> <br /> Prices for long-term buyers were also lowered to catch up with the latest low prices announced by top miner Shenhua Group. Traders deemed it a countermeasure to vie with Shenhua, whose recent intensive price cuts and discounts have attracted most of the buyers.<br /> <br /> "Most of the vessels heading for Tianjin port were also to load Shenhua coal," said a Shanghai-based shipping source.<br /> <br /> Fueled by increased shipping demand, ship owners are mulling over further freight hikes, but the uptrend may not last long, as the August market still faces uncertainties, the source added.<br /> <br /> "Market rumors said that large groups may reach consensus on production cut," said a Beijing-based trader. "But I wonder if it would be carried out eventually."<br /> <br /> But, Shenhua would prefer halts of reselling of coal purchased from third parties to production cuts, pointed out a Guangdong-based trader.<br /> <br /> "Capacity utilization at coal-fired plants has recently increased with higher power consumption amid sweltering weather, but may go down after the typhoon," said a Jiangsu-based utility source, who expected prices to rebound in October.<br /> <br /> One positive change for August could be the anticipated increase in electricity used for air-conditioning, if the scorching weather lasts, the Beijing-based trader said.<br /> <br /> Domestic 5,500 Kcal/kg and 5,000 Kcal/kg NAR coal is mostly heard offered at 475-480 yuan/t and 415-420 yuan/t with VAT, FOB Qinhuangdao, both down 5 yuan/t on week, traders said.<br /> <br /> As the purchase price for high-calorific coal was very low, most utilities dropped plans of buying sub-4,500 Kcal/kg NAR coal, said another Beijing-based trader.<br /> <br /> On July 25, the Fenwei/Platts CCI1 Index for domestic 5,500 Kcal/kg NAR coal traded at Qinhuangdao port fell 0.50 yuan/t on day to 475.50 yuan/t, inclusive of VAT, FOB basis, down 5.50 yuan/t from the previous week.<br /> <br /> Sliding bids<br /> Chinese buyers continued to bid lower for imported cargoes, with August-arrival 5,500 Kcal/kg NAR Australian coal at around $64, CRF South China ports, down $1/t on week and $2-3/t below offers of most miners, said a Beijing-based trader.<br /> <br /> A cargo of Australian 5,500 Kcal/kg NAR coal for September arrival was heard being offered at $66, CFR South China ports, far above utilities’ bids of $63-64/t, said another Beijing-based trader.<br /> <br /> "I have no import coal stocks in hand, and would not enter the market until mid-August at the earliest," said a Fujian-based trader.<br /> <br /> A Shanxi-based trader said he has withdrawn from the market for nearly a month. “It is profitless to do imports, due to falling bid prices and low demand from utilities," he added.<br /> <br /> <p> On July 25, the Fenwei/Platts CCI8 index assessed imported 5,500 Kcal/kg NAR coal up $0.20/t on day at $65.45/t, CFR south China ports, down $0.05/t from a week ago. </p> <p style="text-align:center;"> <img src="/upfiles/news/image/20140726/20140726161934_2177.jpg" alt="" /> </p>