The company said hard coking coal US dollar prices have increased by a weighted average of 16% across all markets, with hard coking coal sales volumes for next financial year expected to be about 35.5Mt, up approximately 2Mt from this financial year.
Semi-soft coal US dollar prices have increased across all markets by a weighted average of 22%. Semi-soft sales volumes are expected to be up to 9.5Mt - similar to the 2001 financial year.
BHP’s approach to price negotiations differed this year and involved individual negotiations with steel making customers in Japan, as well as customers in other markets such as Korea, Taiwan, India, Europe, and Brazil.
The move has allowed BHP to move out of the Japanese established ‘benchmark pricing’ system, which only reflected 23% of BHP’s annual global coal sales.
The metallurgical coal market in Europe, where BHP has a substantial market presence, has been particularly strong, associated with the drop in exports of US coking coals.
“The market in general has continued to strengthen over the course of the last three months and it is expected that the remaining settlements yet to be concluded will be in line with the outcomes to date,” BHP said in a statement.
