COAL prices yesterday rose to a record in Asia as flooding in Australia, power cuts in South Africa and snow storms in Chinese mainland restricted output.
This contributed to electricity shortages in the world's fastest-growing major economy, Bloomberg News reported.
Power-station coal prices at Australia's Newcastle port, a benchmark for Japan, South Korea and Taiwan, jumped 3.9 percent to a record US$93.35 a metric ton in the week ended on Friday, according to the globalCOAL NEWC Index. The price soared 73 percent in 2007.
Coal for delivery to northwest Europe is trading within about six percent of a record.
Coal prices are gaining after Anglo American Plc, South Africa's second-biggest producer, stopped five of nine mines because power supplies couldn't be guaranteed by state utility Eskom Holdings Ltd.
In Australia, the world's biggest coal exporter, Macarthur Coal Ltd and Wesfarmers Ltd said they wouldn't be able to meet contract supplies from some mines in Queensland state after heavy rain.
"Even before these developments, spot prices for coal and coke were at record high levels," Macquarie Group analysts led by Jim Lennon said in a report. "Current price negotiations for annual contracts could be settled at much higher levels than previously thought."
Xstrata Plc, Rio Tinto Ltd and PT Bumi Resources will seek higher contract prices for 2008, with Australian coal likely to fetch more than US$100 a ton at loading ports, compared with US$55.65 a ton in 2007, Christine Salim, an analyst at Samuel Sekuritas in Jakarta, said in a note to clients yesterday. The global average may be US$80 a ton this year, and US$90 a ton in 2009.
Chinese mainland, which burns coal to generate 78 percent of its electricity, ordered domestic coal shippers to halt exports after heavy snow and rail congestion shut supplies to five percent of the country's coal-fired generators.
Bumi Resources, Indonesia's biggest coal supplier, and Yanzhou Coal Mining Co., a unit of China's fourth-biggest coal producer, both reached their highest in more than 10 days on expectation the disruptions will boost prices and earnings.
European coal prices increased 87 percent in the past year as utilities from Germany's E.ON AG to Enel SpA in Italy sought an alternative to increasingly dear oil and gas, and India stepped up imports from South Africa.