BHP aims for monthly met coal contracts

BHP Billiton, which pioneered the introduction of quarterly metallurgical coal prices last year, is reportedly keen to introduce monthly pricing for the commodity to Japanese steelmakers from April.
BHP aims for monthly met coal contracts BHP aims for monthly met coal contracts BHP aims for monthly met coal contracts BHP aims for monthly met coal contracts BHP aims for monthly met coal contracts

The Peak Downs Saraji mine, courtesy Leighton.

Blair Price

April is the start of the Japanese financial year, when annual metallurgical coal prices traditionally kicked off, apart from deals made on the spot market.

The introduction of quarterly prices in 2010 appears to not hold enough benefits for BHP, which has notified Japanese steelmakers about intentions to shift to monthly pricing according to the Nikkei business daily.

The Japanese newspaper expects BHP to benefit from higher prices under the monthly arrangements and reported that steelmakers feared frequent price changes would introduce more volatility to their production costs.

BHP is expecting the devastating wet season in Queensland to affect its met coal production, sales and unit costs for the rest of this financial year.

BHP is the largest supplier of seaborne-traded hard coking coal.

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