Australia's Newcastle Thermal Coal Price Rises to 11-Week High Thermal coal prices at Australia's Newcastle port, a benchmark for Asia, rose to an 11-week high as constraints on exports restrict supply growth amid increasing demand from power generators in Asia. The weekly index for power-station coal prices at the New South Wales port gained 63 cents, or 0.5 percent, to $133.63 a metric ton in the week ended May 9, according to the globalCOAL NEWC Index. The index has traded between $119.50 and $135 since mid-February.
The port, the world's biggest coal-export harbor, increased shipments of the fuel by less than expected in the first quarter as wet weather and a lack of available coal crimped loadings early in the period. Thermal coal producers won a 125 percent increase in annual contract prices in the year that started April 1 to $125 a ton.
``The price seems to have settled in around that contract settlement level,'' said Gerard Burg, a minerals and energy economist at National Australia Bank Ltd. in Melbourne. ``It's still a market that's very much concentrated on a shortage of supply, and that's the key issue going forward. Due to infrastructure constraints around the region, it's very hard to bring on a large quantity of supply.''
Xstrata Plc, the world's largest exporter of power-station coal, BHP Billiton Ltd. and Rio Tinto Group are among mining companies that ship coal through Newcastle.
The weekly globalCOAL index is up 49 percent so far this year. The monthly index gained 0.7 percent to $126.45 a ton in April, from $125.56 the previous month.
Bloomberg - 12-May-08
BWN Price at posting:
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