Regional Coal: Australian coal prices soar as Asian supplies shortage: Report

Coal prices from Australia, the world's biggest exporter of the fuel, rose to a record partly on concern reduced Chinese exports are cutting supplies available to Asian generators, Bloomberg reported Wednesday.

Coal from Newcastle port in New South Wales state last week jumped $2.86, or 5.7 percent, to $53.30 a ton, according to the globalCOAL NEWC Index. Newcastle, the world's biggest coal-export port, ships coal from mines owned by companies such as Rio Tinto Group, BHP Billiton and Xstrata Plc.

Australian prices for thermal coal, the type used by Chubu Electric Power Co. and other generators, have risen by a quarter in the past month as China cut exports to meet domestic demand. Shipments from Australia and Indonesia have been cut by transport problems and heavy rain, leaving utilities scrambling for fuel.

``You've got pretty serious supply-side issues in all three of the big suppliers in Asia Pacific,'' said Clyde Henderson, director of Sydney-based coal consultancy Energy Economics. ``The major one, in terms of how long it's likely to affect the market, is the supply of Chinese steaming coal.''

China, the world's second-biggest coal exporter, shipped about 80.8 million tons of thermal coal last year, more than triple the amount exported in 1997 and one-sixth of total supply. The nation's exports fell by a third in January, according to the Tex Report, a Japanese newsletter.

Shipments from Indonesia have been disrupted by unrest and wetter-than-normal weather in Kalimantan. In Australia, a machine accident reduced exports from Dalrymple Bay in Queensland, while limited rail capacity restricted supplies from Newcastle.

Still, with Indonesia's wet season ending and exports rising from Australia, spot coal prices may not remain high, Henderson said. Coal production from Indonesia may be restored in the next month or so, he said.

``I don't think you can expect this sort of spot price to last for too long,'' Henderson said.

GlobalCOAL's indexes are compiled from both firm bids and offers and trades made on its online platform. Participants include BHP Billiton, Anglo American Plc and Rio Tinto Group, the three largest mining companies; Electricite de France, E.ON AG and RWE AG, Europe's three largest utilities; and Electric Power Development Co., Japan's largest coal buyer.(*)