Turkey may raise the sulfur cap on thermal coal used by power utilitiesin coming months, a move that would open up the market to US exports, sourcessaid Tuesday.
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The new cap being considered would allow utilities to import thermal coalwith a sulfur content of up to 3%, the sources said. The current level is1%-2%, depending on specific utilities' allowances.
Turkey's ministry of energy and natural resources was not available forcomment.
A Colombian material sell-side source said he was concerned as Turkey hasbeen a sizable market for him and the new cap would hand business to highersulfur, and thus cheaper, US material.
Turkey imported 29.4 million mt of thermal coal in the first 11 months of2017, of which 51% was Colombian origin and 41% Russian, customs data showed.
A Switzerland-based trader said one of the largest Turkish powerutilities -- which has been blending Colombian material with Russian -- hadhalted purchasing until the decision was made as it may be able to blend withhigh sulfur US coal.
The source said the utility will be able to switch production to allowhigher sulfur coal usage within a year.
A Turkey-based consumer said there was potential for prices to beaffected as an influx of higher sulfur material from the US would lower theseaborne price.
S&P Global Platts assessed the weekly CIF Turkey 6,000 kcal/kg NAR 90-dayprice at $103.50/mt Friday.
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