Australian thermal coal has reached a symbolic threshold, hitting a spot price of US$100 per tonne, double the Pacific benchmark price of only months ago.

Reuters reports a shipment from Newcastle in November will command that price and calls coal “the hottest commodity of the year”.

The Chinese government shutting down ailing coal mines and reducing hours at others to improve air quality has increased demand for the thermal and coking products.

Analysts have said the coal price should remain strong through to the end of 2016.

"A pick-up in steel production and disruptions to the domestic iron ore trade in China has put an increasing reliance on imports," ANZ commodity strategist Daniel Hynes told the Australian Financial Review.

"This is likely to continue in the short term, which should support iron ore imports in the fourth quarter."

A familiar face has returned to the black on the back of the coal run: Nathan Tinkler. Before he was ruled bankrupt in February he put money into Australian Pacific Coal (AU:APQ). Despite being forced to stand down as managing director, he held onto part of the company through Singaporean holdings, according to the AFR.


Created from Mining Journal