Hard coking coal prices have hit a five year high with prices of more than $300 a tonne on Tuesday, extending a surge that has seen the price quadruple since the start of June this year.
With comments from both of Russia’s two largest coking coal producers tipping it to be an on-going outcome.
As cited by Evraz’s Ilya Shirokobrod who told the Russian Metals Market Conference on Monday, “At the current operating coking coal mines, the potential for growth of production is almost exhausted. That is why today it is difficult to foresee any significant growth in offer volumers.” “That is why we think the prices will stick to their current levels for quite a long time.”
Also note worthy was Whitehaven chairman Mark Vaile, who said in an interview on Tuesday “Unless China decides to lift its restrictions and flood the market, you would expect prices to remain around these levels in the short to medium term.” With shares in the Sydney-based company having more than quadrupled this year.
Whitehaven Coal and consultant Wood Mackenzie however, has taken a more conservative approach, and predicted it will remain elevated in the short-term.
Subsequently, the price spike is expected to benefit mines in the Mackay Region, such as Burton, Blackwater, Middlemount, Moranbah North, Peak Downs, Saraji and Broadmeadow.
Resource reference materials: