July 14 (Bloomberg) -- China’s benchmark thermal coal prices fell to the lowest level in more than six years as stockpiles swelled amid a slowing economy.
Spot coal with an energy value of 5,500 kilocalories per kilogram at the port of Qinhuangdao, China’s benchmark grade, dropped to an average of 500 yuan ($80.60) a metric ton as of yesterday, according to data from the China Coal Transport and Distribution Association in Beijing. That’s the lowest since December 2007.
China’s exports trailed estimates in June, signaling global demand may offer only limited support to the world’s second- largest economy. Slowing growth curbs thermal coal consumption in the country, the biggest user of the fuel, keeping inventories high at power plants and ports, CCTD said in a statement on its website. Stockpiles at Qinhuangdao port increased about 233,000 tons from a week ago to 7.34 million, today data show.
July will be “darkness before dawn” for the seaborne coal market, CCTD said on June 30. Coal prices probably won’t recover until September, after the summer peak in electricity use has reduced stockpiles at power plants, it said.