Stockpiles are up w/w and API2 prices are moderating, but not expecting prices to go back to annual lows
According to Argus, coal inventories at the Amsterdam-Rotterdam-Antwerp (ARA) hub rose significantly to 3.18 million mt by 27 July, up 225,000t from the previous week. API2 coal prices are weakening a bit on the news of higher stockpiles and TTF gas prices that have been moving sideways. API2 prices for August delivery are holding around the $105/mt level and I don’t think we’re going to see prices dip below the $100/mt mark, but market catalysts are pointing to limited upside in the near term. The August API2 contract is down about $5/mt over the last two weeks.
The increase in ARA coal stockpiles was driven by the early arrival of two South African coal shipments totaling 183,000t at Rotterdam’s EMO terminal. EMO’s stocks alone climbed by 200,000t to 2.5 million mt. Stocks at Ovet in Vlissingen rose by 55,000t to 225,000t, while Amsterdam’s HES terminal saw a 30,000t decline to 450,000t. Inventories at EBS in Rotterdam remained unchanged at 1,000t.
No new thermal coal imports are scheduled for ARA this week, but another Capesize vessel departed South Africa recently and is expected to arrive in mid-to-late August.
Improved weather has led to higher Rhine river levels, enhancing coal barge transport conditions. At Kaub, water levels rose from 120cm on 22 July to 183cm on 27 July, surpassing the 180cm threshold required for full-capacity barge loads. Levels are forecast to peak at 330cm by 1 August—well below the flood threshold of 400cm.
In Germany, coal-fired power generation fell during the week of 21–27 July, averaging 2.7GW, down 400MW from the previous week, despite lower solar output. This decline in coal use was offset by a rise in gas-fired generation, keeping total thermal output stable. Wind generation increased to 9.2GW, partially compensating for the solar shortfall.
Based on recent burn rates, current ARA coal stocks would last 141 days at German coal plants, sharply down from 438 days a year ago, reflecting a significant drawdown in reserves.
-TCT
