November 11, 2021 – Coal prices are picking up again in Asia. Dalian Coking Coal futures jump up to 10%. Indonesian nickel matte producer cuts 2022 production outlook by 13%. Base metals rally. SHFE aluminium futures up over 3%. Urea for trucks in short supply in Asia.
Asian coal prices on the rise again
After Chinese government measures had caused coal prices to fall recently, a slowdown in the price decline for coal, coke and thermal coal could already be seen yesterday. Today, Thursday, Dalian Coking Coal Futures jumped by up to 10%. Thermal coal futures on the Zhengzhou Commodity Exchange also rose by more than 3.7% in some cases.
India hit by coal shortage
The massive Chinese coal purchases in recent weeks have emptied the markets and left India, for example, which gets 70% of its energy from coal-fired power plants, with the problem of sharply rising coal prices. Some power plants are down to very tight inventories, according to media reports. And the winter season is coming. In addition, cyclone season has begun in Australia.
Base metals rise again
The rise in energy costs in China has caused base metals to rise across the board. Aluminium futures on the SHFE were up about 3% today and on the LME they are currently up 2.2%. Nickel on the LME is currently still reacting cautiously, but its counterpart on the SHFE has risen by about 1.7%.
Vale Indonesia with 13% less nickel matte production in 2022
The nickel price is also likely to be influenced by news from nickel producer Vale Indonesia, which is expected to produce about 13% less nickel matte in 2022 due to blast furnace maintenance.
Urea in short supply in Asia
We hear that China is facing another challenge. Urea, which in addition to its use as fertiliser and in the chemical industry is also needed as an additive for diesel fuel for trucks, has become very scarce. This has probably already led to truck failures in China.
South Korea also rationing urea
Media reports that urea in South Korea is also in short supply and has to be rationed. According to Asian sources, large quantities of South Korean urea have been sold to China.
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