had not been disrupted significantly by that. A strike by
have some impact but was resolved after four days.
they increased steel output over the past few months.
after a lacklustre couple of years. Marketing staff are
compared to Asia. Anglo Coal, however, has recently announced
plans to sell its stake in Carbones del Guasare. This will leave
the company with no involvement in Venezuela’s coal industry.
Anglo’s decision to exit. During the past year, Mina Norte
due to lack of equipment and funding. Carbozulia was
understood to be providing the new funding for the mine.
2009, with exports understood to have reached around 815kt.
Rim countries also taking more tonnage.
coal for its steelmaking operations.
to steelmakers in the Pacific market. Delivery is due this year.
new 700MW power station in Coronel. An environmental
be achieved by 2014. The plant would be a new market for
imported coal. Electroandina and Edelnor are reported to have
2017. This compares with 6mt recorded last year.
12.5% ash metallurgical coke. Delivery is required in April.
two 50kt cargoes of anthracite. Delivery is required in March
and August. For reference, the price of South African anthracite
has been quoted at around US$85.00/t FOB, but sales elsewhere
appear to be at higher levels reflecting the value in use of
anthracite compared to thermal coal. There has been one such
indication of the price of South African anthracite which is in line
with expectations, and substantially higher than some published
prices. Usiminas was reported to have purchased 100kt of fines
from Glencore at a price of about US$120/t FOB. This is around
50% higher than standard internationally traded thermal coal as
tracked by the e-coal.com South Africa Spot Price, and this
indeed reflects the value-in-use of anthracite. A 50kt cargo was
required for delivery in March, with a second 50kt cargo
required in August. Meanwhile, Usiminas has been evaluating
offers of HV hard coking coal from the USA, having requested
120kt for delivery in Q2. Reports indicate a price of US$200/t
FOB is being sought by shippers on the US east coast at the
time of the enquiry.
The potential for additional exports of Colombian coal to
China and other Asian markets is continuing to interest the
market. The latest rumours suggest the shippers could undercut
Australian exporters of not only thermal but PCI and coking
coal in an effort to find new markets outside the lacklustre
European and US markets at present.
In the US coking coal market in the first quarter of 2010,
prices for US hard coking coal being offered in Europe have
been reported to be from US$175–190/t FOB east coast for HV
material to US$225-240/t FOB east coast for LV product.
Relatively little spot activity has been reported compared to the
Australian spot market. Japanese steel producers were visiting
US suppliers of coking coal amid the calls for quarterly pricing
from Australian shippers. Sources in the USA suggest the JSM
could take up to 4mt of US coking coal in 2010.
As a sign that the market has been picking up, earlier reports
indicated the Chinese steel mills had purchased hard coking coal
priced at about US$160/t FOB Baltimore. Other cargoes had
also been purchased for loading at other ports. The buyers
appeared content to pay a delivered price of just over US$200/t
for this material at the time. Consol was rumoured to have sold
410kst of HV materilal from the Bailey and Blacksville operations
via trader Xcoal.
In the US thermal coal market, Progress Energy Carolinas
issued an LT tender seeking coal for delivery starting next year.
Imported coal is to be delivered to Charleston and Wilmington,
with offers required on a CIF basis. Domestic material is also an
option, with offers requested FOB barge or mine.
Peru’s Enersur is reported to have once more purchased
Colombian coal following its tender seeking 6x50kt cargoes for
delivery during 2010. The price was believed to be in the low
US$70s per tonne adjusted to basis 6,000 kcal/kg NAR and was
reported to be supplied by Belgium’s Electrabel in a trading
In the USA, there have been reports of rising prices for
petcoke during the first part of 2010. A 45kt cargo of material
was reported sold for US$68.00/t FOB basis 7,500 kcal/kg NAR
(8,375 kcal/kg GAD approx). This equates to around US$54.00/t
FOB adjusted to basis 6,700 kcal/kg GAD, but the sulphur
content was much higher than standard internationally traded
coal, at about 7.5%.
In Colombia, environmental concerns have led to the
temporary closure of the 600ktpa port of Michelmar in
Barranquilla. Coking coal shipments are likely to be impacted for
at least three months according to reports from the country.
Exports of coking coal and coke have been impacted further by
the temporary closure of the 900ktpa Mamonal port in
Cartagena due to environmental issues over dust. Around
1.5mtpa of coking coal and coke export facilities have been out
of action following the temporary closure of Michelmar and
Canada’s Nova Scotia Power is reported to have purchased
two Panamax cargoes of El Hatillo coal for delivery in February
and March. The Colombian material is believed to have been
priced at around US$82.00/t FOB basis 6,700 kcal/kg GAD.
Nova Scotia Power has also been in the market seeking up to
750kt of low sulphur coal for delivery during 2011 to 2014.
Colombian exporters have been successful for the first time
in a tender by Korea’s Kowepo, with 400kt being awarded
according to reports from the region. The price is reported to
be very close to the then e-coal.com Colombia Spot Price at
about US$82.00/t FOB basis 6,700 kcal/kg GAD.
The easing of cold weather in China was thought to be
impacting demand for coal ahead of the New Year holiday, but
this appears to have been unwarranted. Market players report
continued activity in that region over the past week or so, with
enquiries for coal being made in all major supplier countries
from South Africa to Colombia, and the USA.
Around the coasts of the Americas, having missed
opportunities to export coal from the US west coast in recent
years, some analysts have been looking again at the potential for
developing port capacity for the Asian market. Reports suggest
the strongest candidates would be the Port of Longview and the
Port of Vancouver in Washington state, and the Port of Long
Beach in California. The development of a new port at Puget
Sound in Washington is also considered possible, although
environmental issues would be greater in any greenfield location.
In Colombia, a new Capesize coal port is being planned in La
Guajira by Brazil’s MPX Energia. The facility would have a
capacity of 20mtpa when complete, and the company is
expected to begin coal production late next year. MPX Energia
has gained approval for the construction of a new port at
Copiago in Chile. Coal could be imported through the facility
for the proposed UTE Castilla power station. In Canada, reports
indicate that the capacity expansion to 29mtpa at Westshore
Terminals was completed in January. Throughput for 2009 is
forecast to be down year on year to around 20mt compared to
21.2mt in 2008. Elsewhere, in Mozambique the government has
signed an agreement with Brazil’s Vale to develop rail and port
faclities to handle production from the Moatize mine. The
development is expected to cost US$1.6bn.
In some ways the recovery of activity in the global economy
compared to a year ago seems remarkable. While mines were
being idled due to a stop in new business, and share prices
plummeting, there have been some unprecedented recoveries
during the past twelve months. Western Canadian Coal is one
such example when its share price fell to around 24p in London
last year. Now renamed Western Coal, the share price has
recovered to around 380p (up 1,483%) in 12 months as its
coking coal operations in Canada, and interests elsewhere
appear to be booming once again. This is the greatest recovery
of any listed coal company noticed during these remarkable times.
The resilience of the coal industry is clear, and while there
are many challenges for the players in the Americas, the
consensus now is that the future is looking generally up. As has
been the case for a number of years now, the international coal
markets are expected to be influenced most strongly from
outside the Americas, with China and India playing major roles in
Dr Tim Jones is Director of e-coal.com Consultancy and Editor of the
weekly publication Coal Market Intelligence which covers 11 spot
markets worldwide, gives key information on the latest deals and
tenders, company news, people and jobs, industrial relations, and
ports, shipping, and freight rates.