First signs of improvement in the situation with coking coal shipments appear in Australia in the second half of January, though it applies to only transport infrastructure so far. For example, on January 16 Australian port Gladstone (annual throughput – 69 mt of coking coal) became fully operational again. Currently, only the raw material from Dawson mine (about 7 mtpy of thermal and semi-soft coking coal), property of Anglo Coal, can be delivered to this port via Moura railway line.
From January 21 to January 25, four lines of Blackwater railway, connecting Gladstone with 14 coal assets, owned by BHP Billiton, Caledon Resources, Ensham Resources, Wesfarmers, Xstrata and Yancoal, will be opened. However, shipments will be minimal, as most of the mines are still flooded. Brisbane port (6.7 mtpy) was opened on January 17, though it will take about a month to restore operation of West Moreton railway line, leading to this terminal.
Forty-six mines are still seeing force majeure in Queensland and mining companies will be able to start dewatering them in a month and a half at earliest. Investment of over $10 bln is needed to eliminate consequences of the flood.
Like last week, there is no Australian coking coal available in the spot market and no deals have been made. At the same time, prices keep growing at a shocking pace. Currently, high quality hard coking coal (ash – 7%, moisture – 7-9%, sulphur – 0.5%, volatiles – 17-20%) is quoted in Australian market at $355-360/t FOB Dalrymple Bay, while last week its prices were $300-320/t FOB.
Offers of semi-soft coking coal (ash – 9%, moisture – 10-11%, sulphur – 0.6%, volatiles – 32%) have reached $250/t FOB Gladstone, against $210-220/t FOB last week. PCI coal (ash – 9%, moisture – 10-11%, sulphur – 0.6%, volatiles – 25-32%) is priced at $258/t FOB Gladstone ($215-225/t FOB last week).
Market participants believe coking coal quotations will grow by at least another $20/t by end-January.
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