Coal market: price talks continue

CHINA is the only country yet to settle hard coking coal prices with the Japanese steel mills, following the fixing of a price with Russian supplier Yakutugol.
Coal market: price talks continue Coal market: price talks continue Coal market: price talks continue Coal market: price talks continue Coal market: price talks continue

 

Staff Reporter

The Japanese financial year 2005 price for Yakutugol’s coal was set at $US125 per tonne free on board (FOB), the same FOB price agreed with Canadian and Australian suppliers, Clyde Henderson of Energy Economics said.

Price settlements for low volatile PCI are unclear, but it appears settlements to date in Japan have been around $US102/t FOB, he said.

Xstrata has settled semi-soft coking prices with Nippon Steel at $US79.50, possibly as a result of some smaller suppliers settling earlier at around the mid-$US70s.

“With increased Xstrata tonnage under their belts, the Japanese steel mills went on the offensive, reducing their price offers to smaller suppliers to the low $US70s,” Henderson said.

The details of price settlements for steam coal are also unclear since the Chubu Electric settlement with Xstrata and Coal & Allied at $US54/t. There are conflicting reports about Tohoku Electric, with some analysts saying the utility was yet to settle and other reports it had settled lower than Chubu. Korean utilities appear to be holding out for contract prices of around $US50/t FOB.

“Spot prices out of Newcastle (Australia) remained flat at $US50/t through to mid-February but increased to $US51.3/t by the end of February, so the Korean’s may have to give some ground to achieve a settlement,” Henderson said.

Spot prices out of Richards Bay also look to have bottomed at around $US43.0/t FOB in mid-February, with bid prices increasing sharply to $US44.5/t by the end of February 2005.

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