China Coal-Spot prices to stablise as seasonal demand wanes

SHANGHAI, Aug 20 - Spot thermal coal prices in China's top coal shipping port Qinhuangdao stayed unchanged from a week earlier and are likely to stablise in the coming weeks, as high seasonal consumption is expected to fade in September.

Price for coal with calorific value of 5,800 kcal/kg (NAR) stood at 600 yuan ($87.85) to 610 yuan a tonne. Coal with calorific value of 5,500 kcal/kg was quoted in the range of 555 to 570 yuan, according to the Qinhuangdao Seaborne Coal Market (www.cqcoal.com)

"Demand for coal is not great, but not bad either," said a Guangdong-based coal importer. "The summer effect may stay into September."

Analysts said spot coal prices in Qinhuangdao were likely to stablise as a result, especially as power demand in coastal regions, with a concentration of light industry, had not improved as fast as in inland provinces, where more energy-intensive heavy industry plants are located.

Power consumption in light industry in July edged down 0.34 percent from a year earlier, compared with a 3.28 percent increase in power use in heavy industry, according to the National Development and Reform Commission, the country's top economic planner. [ID:nPEK215009]

"Qinhuangdao prices didn't rise much in the summer, and won't have momentum for a further rise in September, when demand will weaken," said an analyst with a large state-owned brokerage, who declined to be named.

Supply might be affected by production halts at small mines, likely to be ordered ahead of the politically sensitive National Day holiday on Oct. 1, but the influence will be offset by weaker demand, he added. ($1=6.830 Yuan)