SYDNEY Feb 14 Weak demand from Chinese power
companies drove Australian thermal coal export prices to a
five-month low this week, with ample inventories on hand
expected to further cap sales.
The Newcastle weekly spot index fell to $77.73
a tonne from $80.01 on Feb. 7.
The index, tracking prices from the world's top thermal coal
exporting terminal, has been in steady decline over the past
seven weeks, dropping by 10 percent since Dec. 20.
Sam Walsh, chief executive of Rio Tinto ,
one of Australia's biggest coal miners, late Thursday told
reporters thermal coal markets "remained a problem" for the
company as it wrestles lower production costs amid weak
Trade sources said a return to a full-work schedule this
week following the Lunar New Year holidays across most of Asia
failed to generate much fresh interest among buyers, who were
more apt to work off stockpiles accumulated before the break.
SHIFT FROM COAL
Guangdong, a major industrial province in southern China, is
looking to use "cleaner" energies in the future, according to
The province is targeting 36.2 percent of its energy demand
to be met by thermal power, down by 6 percent from 2010, it
The gap in demand is expected to be met with a combination
of hydro, wind and nuclear power. China's nuclear usage rose to
an 8-year high of 7,893 nuclear power units in 2013.
The average price of steam coal in China ended at 571 yuan
($94.17) per tonne this week. This was a decrease of 13 yuan
($2.14) per tonne versus the previous weekly reporting period,
according to the Bohai Rim index, which tracks thermal coal
prices at six ports.
In coking coal, China's major producers were lowering prices
to address weakening demand, in sharp contrast to the resilience
in the market seen around the same time last year, sources
familiar with the sector said.