Australia's Whitehaven says met coal price to ease this quarter
SYDNEY Jan 23 (Reuters) - Australia's Whitehaven Coal Ltd says it expects to see a modest drop in prices for its metallurgical coal sales in the current quarter on subdued demand from Asian steelmakers.
The company, which posted a 52 percent rise in December quarter coal sales owing to strong production growth at its Narrabri colliery, forecast an average sales price of $101 per tonne (fob) for its metallurgical coal, down from $103 in the last quarter.
Recent metallurgical coal price settlements by major coal miners showed a fall in the price of all metallurgical coal types for the first quarter of 2014, underscoring a weak demand outlook.
The hard coking coal price was settled at $143 per tonne, with low volatile PCI and semi-soft coking coal benchmark prices settled at $116 per tonne and $103.50 per tonne, respectively.
"North Asian steelmakers maximised their hot metal production in the December quarter, leading to increased use of low volatile PCI rather than semi-soft coking coal," the company said.
In thermal coal, used for power generation, Whitehaven said it sees the market "relatively well supplied for 2014", with pricing guided by term negotiations set to begin in February or March and covering the April 1, 2014-March 31 2015 trading year.
Morgan Stanley in a report on Thursday said it believes thermal coal prices have passed their cyclical low, but did not expect a strong recovery for at least another year.
Whitehaven's share price has suffered from a weak outlook for coal and a lengthy court battle in Australia that clouded development of a major growth project.
Whitehaven shares closed at A$88 on Wednesday, up 27 percent from a low point in November but off sharply from its 12-month high of A562.
Whitehaven last month won a court fight against environmentalists who sought to overturn the Australian government's approval of the A$767 million Maules Creek mine, designed to yield 13 million tonnes a year.
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