Coal prices back to $U100 tonne: GVK Date November 22, 2012 - 6:20PM
AAP
Coal prices will recover by the end of next year to $US100 ($A96.92) a tonne, a Queensland mining venture linked with billionaire Gina Rinehart says.
Spot prices for thermal coal have plummeted during 2012 to a three-year low at $US81 ($A78.51) a tonne at the end of October, as concerns about the global economy put pressure on commodity prices.
This week, prices have reached $US84 ($A81.42) a tonne.
GVK-Hancock Coal, an Indian-Australian joint venture that is developing a major thermal coal project in Queensland's Galilee Basin, says better times lie ahead.
Advertisement "We believe that the outlook for coal is pretty good," the company's chief development officer Justin Crotty told the Major Projects Conference in Brisbane on Thursday.
"We think that by the second half of next year, we'll see prices graduating back to around $US100 a tonne ... and for about two years that's going to plateau around that level."
Thermal coal is used for electricity production.
GVK-Hancock expects to start exporting coal from Abbot Point in Queensland by late 2016 as production gets underway at its $6.4 billion Alpha project in the Galilee Basin.
A 495km rail line is being built to connect the mine 40km northwest of Alpha with the port north of Bowen.
Mr Crotty said stronger demand from China along with the emerging Asian economies of Vietnam, the Philippines and Thailand would help support coal prices.
"We actually think that beyond 2015 we will see the demand for coal basically increase at least two Alpha coal projects a year," he said.
