Ahh yeah sorry hadn't heard about the coal settlements. US$300 a tonne!
Coal miners secure massive price riseFont Size: Decrease Increase Print Page: Print Andrew Trounson | April 07, 2008 AUSTRALIAN producers of coal, the nation's largest export commodity, have secured a stunning price rise because of supply shortages.
European and Asian steel mills have agreeing a trebling in premium hard coking coal prices to around $US305 a tonne.
The reported settlements come on the back of soaring spot prices after millions of tonnes of production were lost because of severe flooding in Queensland in January and February.
According to ANZ commodity analyst Mark Pervan, the flooding has likely cut the world supply of seaborne coking coal - also known as metallurgical coal - by 4-6 per cent.
There are also reports that Japanese utilities have agreed to a more than doubling in Australian thermal coal prices to $US125 a tonne, up from $US56 a tonne.
Coal is Australia's biggest commodity export earner, with ABARE Economics predicting sales of 252 million tonnes 116 million tonnes worth $35.5 billion in the 2008 financial year, prior to the latest price hike.
ABARE predicts coking coal producers will sell 136 million tonnes worth $27. 4 billion onto the global market in the 2008 financial year.
According to industry newsletter the McCloskey's Coal Report, BHP Billiton has secured a $305 a tonne contract price from Indian/European steel giant Arcelor Mittal. Separately, South Korean steel producer Posco has confirmed it has agreed a 205-210 per cent rise in Australian coking coal prices from last year price of $US98 a tonne.
BHP Billiton declined to comment, and traditionally doesn't confirm price settlements until most of its contracts are agreed.
Swiss-based Xstrata, the world's biggest thermal coal exporter with significant operations in NSW and Queensland, has reportedly secured a $US125/tonne price from Japanese utility Chubu.
The coking coal price increase is above analyst expectations that back in March were for a coking coal price of $US225-$US250 a tonne.
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