BHP said it adopted individual negotiations with steel making customers in Japan, as well as customers in other markets, including Korea, Taiwan, India, Europe and Brazil.
"This approach differs to price negotiations in previous years when a ‘benchmark pricing’ system was established in Japan," the company said.
"The benchmark price was commonly used in public reporting of coal pricing settlements and, for BHP, reflected the price received for approximately 23% of our annual coal sales.
"The benchmark pricing system is no longer operating in Japan and coal prices are now being established globally with customers on an individual basis. Accordingly, and owing to the fact that BHP is engaged in sensitive commercial negotiations with a range of customers, the company will publicly announce average price settlements when price negotiations for the majority of its expected sales tonnage have been completed."
BHP would advise price settlements globally for three main products - hard coking coal, semi soft coking coal, and thermal coal. BHP expects a higher percentage for semi soft coking coal, and thermal coal from Japanese, Korean and other customers. The producer does not have significant tonnages of semi-hard coking coal, sold in the past at big discounts to hard coke.