Thermal coal prices will remain at relatively high levels over the long term despite aggressive mine expansions to meet the growth in Asian demand, particularly from China and India, according to Wood Mackenzie coal analyst Prakash Sharma. Speaking at the Coaltrans India conference in March, Sharma said seaborne thermal coal demand will "grow exponentially" from now until 2030 mainly because of an increase in demand from China and India. He said that steam coal prices in the long term will defy expectations of a drop and will instead remain at high levels. Sharma said there may be short-term seasonal fluctuations such as softer prices in the current quarter, but the Newcastle reference coal price for Australian coal will increase progressively. He said cost pressures, infrastructure bottlenecks and a decrease in export coal quality will combine to hold prices at traditionally high levels.
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