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fifo Crushettes Coaches Award was won by Samantha Evans (L-R) Crushettes Best Back was Tasma Vesey Aboutusgenericimage_3 Crushettes Rookie of the Year was won by Zoe Mackay Aboutusgeneric_1 (L-R) Dwayne Parsons was awarded Best Back Greg Byrne, Downing; Ian Reed, QNP csg Most Improved for Crushers was Brendan Fuller Construction (L-R) Ryan Palmer won the Managers Award and Best Forward seen with Boofa Callanan Steve Beale and Chris Dunphy, MIPEC mining csg
fifo Crushettes Coaches Award was won by Samantha Evans (L-R) Crushettes Best Back was Tasma Vesey Aboutusgenericimage_3 Crushettes Rookie of the Year was won by Zoe Mackay Aboutusgeneric_1 (L-R) Dwayne Parsons was awarded Best Back Greg Byrne, Downing; Ian Reed, QNP csg Most Improved for Crushers was Brendan Fuller Construction (L-R) Ryan Palmer won the Managers Award and Best Forward seen with Boofa Callanan Steve Beale and Chris Dunphy, MIPEC

Price “better than expected”
Post TC Debbie coal price confirms industries viability.
Wednesday 28 June 2017  

A new benchmark coal price has been settled for June after months of uncertainty and delay in the wake of Cyclone Debbie.

The new benchmark price of around $US126, a tonne of semi-soft coking coal, is significantly lower than the record highs experienced earlier this financial year when China slashed production, and TC Debbie closed the Bowen Basin supply chain for a month.

However, it’s significantly better than what now appears to have been the bottom of the cycle in late 2015 when metallurgical coal prices hit $US74 a tonne.

In its most recent operational update, Stanmore Coal has been encouraged by the new benchmark.

“With the financial year drawing to a close, the Company remains on track for a strong June quarter and will marginally exceed prior guidance for ROM and product coal produced,” they said.

“This performance, coupled together with the higher than anticipated June quarter benchmark settlement of USD126/t for semi-soft coking coal, has Stanmore in a strong position to finish the year.”

However, perhaps the bigger story is the way that the benchmark price has been discovered.

Historically, Japan’s Nippon Steel was such a big player in the market that the price they settled with their suppliers, became the default benchmark price for coal.

However, the massive volatility in prices this financial year has forced them to abandon that system, and instead, they will now buy coal at a price based on three coal price indices.

The change reflects Japan’s reduced influence on the world coal market.

For example, in 2008 Japan bought 61.5 million tonnes of coking coal which was more than double India, and nearly twenty times China’s 3.2 million tonnes.

However, last year Japan imported 53.4 million tonnes against India’s 46.7 million tonnes and China’s 35.7 million tonnes.

One of the indices being used is from commodity price reporting agency Argus, who says a major transformation in how coal prices are settled will continue.

"Miners and mills have largely used 'index baskets' — an average of two or more indexes — in their supply arrangements to date, with indexation at an early stage of adoption," Argus Media chairman and chief executive Adrian Binks said.

"In the Australian premium coking coal segment, Argus has typically formed 50pc of the mix in the overwhelming majority of fob indexed supply arrangements concluded over the last 24 months."

“This market is still maturing, and so it requires an approach that supplements liquidity with active engagement of the market.

“This shows the quality of our price reporting and the confidence of the market in our methodology.


 

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