The boom continues

摘要

Most coal marketers would never have believed in their wildest dreams that they would be fronting up to negotiate three-figure deals with traditional customers. But this is what has been happening as coal prices continue their climb to historic highs. In our last issue we reported on spot coking coal sales above US$150/t FOBT but now term business has been sealed by Xstrata with Japanese steel mills (JSM) at a price reported to be close to US$125/t FOBT. The market for thermal coal is also continuing to rise with Newcastle prices in the mid-US$50/t range. With the northern hemisphere summer around the corner, it would not take much to send these prices much higher. The best illustration of how quickly coal prices have moved over the past 3-4 months is provided by the series of coking coal settlements made since BHP Billiton (BHPB) contracted its tonnage to the JSM for a 22 per cent rise at US$55-57/t FOBT back in December. At the time, this was generally perceived as a good result for coking coal producers as prices have rarely exceeded US$55.00/t since the 1980s.