China's portside thermal coal market sentiment improved slightly on the last trading day before a weeklong holiday, as holiday and early-October restocking continued on a limited scale and sellers grew more reluctant to liquidate stocks, anticipating still tight supply after the break.

The outlook following the National Day holiday (October 1–7) was cautiously optimistic. Participants anticipated that the overall production recovery is likely to be gradual, delivering only limited incremental volumes to northern ports. With previous supply shortfalls taking time to work off, end-user inventory replenishment remains unfinished.

Offers, therefore, were broadly firm. Shanxi 5,000 Kcal/kg NAR coal with 0.6% sulfur was quoted at 910 yuan/t, FOB with VAT, though sellers noted difficulty closing deals at that level amid strong holiday wait-and-see sentiment among buyers.

One Hebei-based trader source said buyers remained hard to secure cargoes for 0.8%-sulfur 5,000 Kcal/kg NAR coal at prices under 900 yuan/t. "Low-cost cargoes are scarce at present, so the willingness to liquidate at lower prices is likewise limited," he said.

Cargoes of 5,500 Kcal/kg NAR were talked in the 1,000-1,010 yuan/t range with tight availability as sellers reserved stocks, while 4,500 Kcal/kg NAR material with 1.0% sulfur was heard offered at 810-815 yuan/t.

One northern China-based trader noted that rising production costs for Xinjiang coal have made shipments to the northern ports less competitive than local sales, meaning the overall supply addition for Xinjiang coal at the portside market would remain modest.

Participants said that attention is now focused on the pace of production recovery post-holiday, the trajectory of port inventories, and power-plant coal consumption.

Coal burns at power plants under six major Chinese coastal power groups stood at 0.89 million tonnes on September 29, edging up 0.11% week on week yet falling 6.83% on the month, while their stocks stayed rangebound during the same periods.

On September 30, Sxcoal's CCI index for domestic 5,500 Kcal/kg NAR coal at Qinhuangdao port was unchanged day on day at 991 yuan/t. The index for 5,000 Kcal/kg and 4,500 Kcal/kg NAR coal stood at 893 yuan/t and 805 yuan/t, both flat.

Higher import coal tender prices

Sentiment continued to improve in China's import thermal coal market, with bidding prices to utility tenders climbing up. Prompt cargoes were largely digested, while forward supply still faced constraints and higher costs. Some participants expected the market to stay in a stable-to-firm bias into the post-holiday window.

Traders' bidding prices to utility tenders for this grade were heard on September 29 at 998-1008 yuan/t, CFR South China with VAT, with October-November delivery, marking a further increase from a day earlier. The lowest bid netted back to roughly $107/t FOB on a Capesize basis.

Tender prices remained below forward cargo offers from overseas sellers, leaving traders cautious in locking in new cargoes.

"Australian 5,500 Kcal/kg NAR coal is offered by overseas sellers at around $110/t FOB," a southern China-based trader source said. "It is now viewed as a normal level following deals near $109/t FOB a couple of days earlier."

Sources also noted a moderate easing in Capesize freight rate from Australia to South China, at $22-22.5/t, owing to reduced iron ore volumes, but the overall landed costs in China stayed high.

For lower-CV coal, traders' bidding prices for utility tender of Indonesian 3,800 Kcal/kg NAR coal were heard at 670-680 yuan/t, CFR with VAT, translating to roughly $77-78/t FOB on a Panamax basis.

Panamax freight rate from South Kalimantan to South China hovered flat at about $11/t, according to a southeastern China-based trader source.

Sources said Indonesian sellers have grown less willing to disclose available volumes during the CT Asia conference, suggesting prices will likely remain firm in the near term.

Traders in eastern and southern China are cautiously optimistic about the outlook, citing expected supply constraints in Indonesian fourth-quarter production, gradual domestic mine restarts, and ongoing winter-stocking demand.

On September 30, the CCI index for Indonesian 3,800 Kcal/kg NAR coal gained $0.5/t day on day to $76.5/t FOB and $88.5/t CFR South China port. The index for Australian 5,500 Kcal/kg NAR coal also climbed by the same amount to $130.5/t CFR.