OREANDA-NEWS. Spot trades of seaborne metallurgical coal into Asia-Pacific have fallen 9.6% year on year to 28.2 million mt in the first half of 2015, led by a significant decline in Chinese imports and slower-than-expected growth in India's demand.

Platts recorded a total of 367 transactions for met coal -- comprising premium, second-tier, semi-hard, semi-soft coking coals and pulverized coal injection (PCI) coals for steelmaking -- over January-June.

H1 2015 Asia: Metallurgical Coal Product Split

The figure does not include cargoes sold into regions outside of Asia-Pacific such as Europe and South America.

In comparison, Platts captured 435 deals, totaling 31.2 million mt, in H1 2014.

The calculations are based on spot deals observed by Platts as part of its Market on Close assessment process.

Platts data measures transaction volumes rather than cargo volumes. This means a single cargo can be counted more than once as it trades repeatedly in the spot market before reaching the final end-user.

Prime hard coal accounted for the majority 36% of the total trade volume in H1 2015, followed by second-tier HCC at 26%, PCI at 24%, and semi-hard and semi-soft coals at 14%.

The data excludes transactions of which vessel destination was unknown.

Spot prices have trended lower over the first half of this year, as demand from China ebbs.

But renewed buying of tier-two HCC from China has tempered the fall in tier-two HCC prices, with the spread between premium and tier-two HCC narrowing to an all-time low of $3.25/mt on May 21.

This was the lowest since Platts started assessing prime hard prices in October 2010.

The sudden demand for tier-two HCC with low ash and sulfur content by north China end-users in early May due to rising levels of ash content in domestic alternatives also provided a temporary boost, sources said.

This saw tier-two HCC prices surging 11% from May 7 to be assessed at $93.75/mt CFR China on June 18, the highest in three months. But with relatively limited supply, overall trade volume for tier-two HCC fell 18% year on year to 7.4 million mt in H1 2015.

In comparison, ample regional supply of premium coal saw its share in the total trade volume expanding to 36%, or 10.2 million mt, in H1 2015 from 31% in the year-ago period.

Despite a sustained re-stocking phase over March-June, a sharp fall in overall demand from China depressed prime hard coal prices.

Premium low vol HCC grade prices averaged $103.05/mt CFR China over H1 2015, down 21% from the same period last year, Platts data showed.

Meanwhile, China's coal quality restrictions on PCI that came into effect January 1 resulted in a sharp fall in imports over January-March.

Despite a modest recovery in the second quarter, total PCI spot trades in Asia observed by Platts fell 10% year on year to 6.7 million mt in H1 2015.