Improved pricing and demand for US metallurgical coal in 2010 owing to recovering Asian demand and higher US steel production could cushion the weakness in the domestic steam market, Standard & Poor's analysts said Tuesday. Marie Shmaruk, director of S&P's metals and mining sector, said 2009 was a “challenging year” for the mining sector, which includes both metals and coal, as a whole. But she expects demand, and thereby pricing, in the mining sector to stabilize in 2010, but not to the levels seen in the first half of 2008. In fact, Shmaruk said she expects recovery to be “choppy” because relatively weak industrial demand and high inventories could force further production cuts at US coal companies and put pressure on coal contract prices, which are up for renewal in 2010.
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