Benchmark thermal coal prices at China’s Qinhuangdao, the nation’s biggest delivery port for the fuel, fell for the third week as inventories continued to climb on slowing demand.
Coal with an energy value of 5,500 kilocalories per kilogram fell 0.6 percent to a range of 760 yuan ($121) to 770 yuan a metric ton as of yesterday compared with a week earlier, according to data today from the China Coal Transport and Distribution Association. That’s the lowest since March 21.
Coal inventories at power stations were higher this year compared with last, with major plants holding the equivalent of 22 days of demand as of Feb. 10 versus 17 days a year earlier, according to data from the association.
Stockpiles at Qinhuangdao, which delivers half of China’s seaborne coal supplies, rose for the eighth straight week to 8.25 million tons as of yesterday, an increase of 3.7 percent from a week earlier, according to the data today.
Prices may fall 5 percent this year and another 10 percent in 2013 as domestic coal production outpaces demand and transport constraints ease, according to estimates by Sanford C. Bernstein & Co. published in a report Feb. 21.
— With assistance by Baizhen Chua