Thermal coal prices across China's major production regions saw modest gains on April 10, driven by steady buys from chemical plants and term contract buyers. Yet, cautious stance was growing post-rallies.

Of the 90 coal mines surveyed by Sxcoal on April 10, 11 mines raised prices by an average of 7.18 yuan/t, while six mines lowered prices by 13 yuan/t on average. The remaining 73 kept prices stable.

Overall thermal coal supplies stayed ample, with most mines operating at normal capacity. Some downstream users slightly accelerated procurement, with coal trucks concentrating at mines offering competitive prices.

Miners in Inner Mongolia's Ordos achieved a rough balance between production and sales. Many reported decent offtakes, keeping mine-mouth offers generally stable with small gains. Certain slack and lump grades extended rises of 5-10 yuan/t.

"Our washed slack coal rose 10 yuan/t to 628 yuan/t, backed by decent demand from coking and chemical plants," an Ordos-based miner said.

In Shaanxi's Yulin, sentiment was bolstered by several consecutive days of rallies in auction settlements at major mines. This encouraged smaller miners to lift prices by 5-10 yuan/t. 6,000 Kcal/kg NAR slack coal (S 0.6%) gained 10 yuan/t to 620 yuan/t.

Several favorable factors underpinned the current price stability. In the non-power sector, the ongoing peak season continued to bolster industrial coal demand, particularly from chemical sectors. With elevated oil prices enhancing coal's substitution appeal, chemical plants were more willing to accept current high price levels.

While power plants primarily prioritized long-term contract fulfillment, some that previously held back on restocking were engaging in spot purchases to meet immediate needs. Meanwhile, imported coal prices are expected to hover high in the near term due to unclear international conditions, providing a cost floor for domestic thermal coal.

However, the market's upside potential remained constrained. Sustained price upticks prompted some traders to sit on the sidelines, focusing on inventory drawdowns rather than fresh restocking. A few mines even made modest downward adjustments.

In Inner Mongolia's Zhunger, a major miner lowered prices for 5,800 Kcal/kg NAR raw coal (S 0.2%) by 10 yuan/t to 565 yuan/t, mine-mouth with VAT. "The market lacks robust upward strength due to moderate end-user demand," a local source said.

Online auctions in Shaanxi and Shanxi also experienced losses. Some slack grades were heard concluded at 12 yuan/t below the last auction, while Shanxi-sourced 4,300 Kcal/kg NAR mixed coal (S 1%) dropped by 6 yuan/t to 347 yuan/t, mine-mouth with VAT.

Demand from the power sector weakened further. Coal consumption at power plants continued to trend lower over the past week. Daily coal burns at plants under six major coastal power groups stood at 697,200 tonnes on April 9, the lowest level since March 4, Sxcoal data showed. The volume was 7.0% lower than the week-ago level and down 9.1% month on month.

Their fuel inventories, however, saw modest upticks to 12.83 million tonnes. As such, generators mainly shipped term contract supplies, and spot purchases remained on a need-to basis.

Some power plants began unit maintenance, and hydropower and solar generation ramped up, displacing thermal power output and further capping generators' buying enthusiasm.

Nevertheless, near-term prices are less likely to slump, as most mines report minimal inventory pressures, keeping mine-mouth offers range-bound.

On April 10, Sxcoal assessed Datong 5,500 Kcal/kg NAR coal and Ordos 5,500 Kcal/kg NAR material at 609 yuan/t and 551 yuan/t, respectively, mine-mouth with VAT, unchanged on the day. Yulin 5,800 Kcal/kg NAR grade rose 1 yuan/t to 618 yuan/t.