Asia Coal-Australia thermal coal prices dip in week

PERTH, July 14 (Reuters) - Australian thermal coal prices slipped about $2 in the week ended on Wednesday as summer buying in Asia, especially from China, slowed to a halt and Japanese demand remained weak.

Thermal coal on the globalCOAL Newcastle index for the week settled at $120.71 per tonne on Wednesday, down from $122.63 a week earlier and down from $122.45 on Friday.

Demand from China, which had been on a buying spree earlier this summer and put a floor under prices, has slumped as utilities' coal inventories as well as those at China's ports have swelled.

"China is weak and so the whole Pacific (coal market) has no engine," one market source said.

Prices for domestic thermal coal in China have also dipped lower to 840 yuan ($129.87) for coal with a heating value of 5,500 kcal/kg NAR, down from 843 yuan on Friday, according to industry data website SXCOAL (www.sxcoal.com).

"Domestic utilities already have very high inventories and at the South China ports, they already have inventory," the source said, adding that some vessels were even having difficulty discharging cargoes.

Elsewhere in Asia, summer requirements for thermal coal have been largely filled, sources said.

"Buyers should have secured coal to be consumed during the summer already," one Sydney-based trader said, adding that Japanese utilities' electricity conservation programs have likely further weakened demand.

Korea Southern Power Co Ltd (KOSPO) has begun looking for supplies for the fall of 520,000 tonnes of steaming coal for delivery between August and October via tenders, the company said late Monday.

Demand for sub-bituminous coal from Indonesia has also been dropping, traders said, with China out of the market and Indian demand also weaker due to the monsoon season.

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($1 = 6.468 Chinese yuan) (Reporting by Rebekah Kebede; Editing by Ed Lane)