Traders push thermal coal rally

Courtesy of ANZ.

Newc FOB physical thermal coal and Australia FOB coking coal prices firmed last week, with Asia demand showing signs of improvement for early next year loadings. Reports suggest traders were covering their short positions before closing their books or the year and ahead of Xstrata’s annual negotiations with Japanese utilities for thermal coal contracts starting in January. Reports suggest Japanese utilities are hoping for settlements of USD90-95/t, while Xstrata is seeking prices above USD95/t. This week, thermal coal prices could track sideways with many buyers having already completed seasonal winter restocking requirements. Iron ore prices were unchanged, with market participants remaining cautious about China’s economic recovery.

ANZ Commodity Daily 745 191112