<div>Prompt physical coal prices slipped by 50-60 US cents a tonne for the third day in a row as weak demand from India and China outweighed anxieties about South African strikes spreading to disrupt exports. Although India's monthly imports have been strong and steady all year, spot buying for Q4 has been disappointing, suppliers said. <br /><br />"Having waited for prices to drop to $80 for South African before buying and then seen the market fall below that level, they've backed off now because it may not have hit the bottom yet," one European trader said. November and December loading South African cargoes were bid at $74.00 a tonne FOB Richards Bay on Friday - having fallen to a nearly three-year low of $77 on Wednesday. Bids of $74 which were dismissed as unrealistically low by many players on 25 October seemed on Friday far more realistic a reflection of the market's weakness in the last two months of the calendar year, traders and utilities said.<br /><br />While prices appear vulnerable to further falls, Indian buyers in particular will remain sidelined, they said.<br /><br />A revival of Asian spot buying is unlikely in the near-term, Barclays Capital said in a research note on 26 October . "Barring any unexpected large-scale supply disruptions, we only expect prices to receive support when large importers such as India and China become active on the prompt market again," Bar Cap said.<br /><br />"This is unlikely to happen in the very short term as China's inventories are still plentiful and India is banking on further downward price moves," the note said.<br /><br />Around 1.2 million tonnes a year of coal production has been halted by strikes in South Africa which have cost the continent's largest economy over 10 billion rand this year. However, the coal market has been largely unmoved because there has been no impact on rail transport or port operations and the market remains oversupplied, Deutsche Bank said in a note on 26 October.<br /><br />"Widespread signs of a production response are lacking, and we are therefore neutral to negative on thermal coal pricing in the near term despite the already-low level relative to marginal costs," Deutsche Bank said.<br /><br />(Reuters)</div>
