China's imported low-CV thermal coal prices faced downward pressure, with traders looking to sell amid weakened utility purchases and sliding tender prices.

"Import appetite has waned since last week, putting slight downward pressure on prices, though most (participants) see this as a short-term correction," said a Beijing-based buyer source.

Spot offers for Indonesian 3,800 Kcal/kg NAR coal were widely heard at around $52/t FOB. A Fujian-based trader source said the level was increasingly hard to sell and indicated plans to make a slight rollback. "Low-CV coal is still cost-effective compared with domestic equivalents, so any downside may not be large."

More bids to utility tenders for the grade dropped below 480 yuan/t CFR China with VAT, which netts back to below $50.6/t FOB. Some sources said bids may go lower to around 465-470 yuan/t CFR (or around $49/t FOB on Panamax basis) as traders look to liquidate, but noted offers from overseas miners won't reach such levels.

This is mainly attributed to seasonal rainfalls that continued to cast a pall over supply availability in major mining regions. Indonesia's Meteorology, Climatology, and Geophysics Agency forecast increased rainfall in East and South Kalimantan over November 28-December 1, posing continued setbacks on coal production.

Additionally, sources reported slowed activities at some mines that depleted their RKAB production quotas for the year, leaving miners reluctant to cut prices.

Chinese utilities, which continued to run with relatively comfortable stockpiles, were largely inactive in spot procurement, given rising inventories at ports and a pending significant seasonal uplift in coal burns.

Some trader sources cautioned that rising freight rates, coupled with declined tender prices, may reduce margins for importers and make them even less involved in sourcing cargoes. Sources said the Panamax freight rate from East Kalimantan to South China has climbed 1.7% week on week to around $9/t.

Some warned of downward pressure if more spot low-CV cargoes earlier purchased by traders hit the market. One buyer source said fixed-price deals for January-delivering 3,800 Kcal/kg NAR coal, which was once resisted by traders, have become negotiable again. Even so, they were reluctant to enter into contracts.

"The market may have more room to correct, and any rebound may depend on future coal burns," the source added.

China domestic prices under pressure

China's domestic portside market was similarly subdued amid lower index-linked offers, scant inquiries, and limited concluded trades.

"Buyers are digging in their heels, with counterbids dropping more steeply than asking prices," said a Hebei-based trader source, adding that certain utilities postponed shipments into early December due to weak demand.

One trader offered a 5,000 Kcal/kg NAR coal with 1% sulfur at a 5 yuan/t discount to the CCI 5000 index, while buying indications were heard at 7 yuan/t below the index, with no confirmed trades.

With high stockpiles, Huanghua port saw an increase in vessel arrivals for loading, sources said. Stock buildups and limited improvement in end-user restocking increased selling pressure, making further price cuts likely.

Sources also flagged possible weaker coal demand from cement plants in the near term, as some provinces, including Shaanxi, Inner Mongolia, and Shandong, have imposed staggered cement production for four to five months to curb emissions during the heating season.

Despite prevailing soft sentiment, some participants still expected a buying window to emerge around mid-December as temperatures drop, suggesting the outlook is not uniformly bearish.