The contract will be available on the ICE platform, with globalCOAL chief executive Eoghan Cunningham saying unprecedented volatility in the coal markets over recent times had led to demand for a cleared coal price risk management product such as the gC ICE NEWC Futures contract.

ICE Futures Europe president David Peniket said the Newcastle Futures contract would complement the exchange’s existing Rotterdam and Richard’s Bay contracts and result in an unequalled global seaborne coal offering for market participants.

“In light of the rising popularity of ICE Futures Europe’s coal contracts in recent months, reaching a record 34 million tonnes traded in October, we see a bright future for exchange-listed coal derivatives,” he said.

Patersons Securities coal analyst Andrew Harrington told ILN it was hard to foresee the long-term impact on price that the contract might have.

“I think it’s quite a positive development,” he said.

“Whether in terms of price or demand impacts, I am not sure, but the coal market has been lagging in terms of financial and paper products, far behind the base metals and the oil market, so it is good to see that this is developing and it probably provides a fair amount of transparency on futures prices.”

Harrington added the coal market was still relatively traditional compared to other commodities.

Newcastle coal spot prices are already available on the globalcoal.com website.