Coking Coal Prices Jump

Spot prices for cocking coal have increased to $220 a tonne. Coking coal is a raw material for steel making. The jump in spot prices has opened up a US$13billion annual revenue gap as contract prices were set almost a year ago. The world’s biggest coking coal producer and exporter BHP Billiton (BHP) have been in preliminary talks with Asian steel makers adding rumours that coking coal contract prices may rise to more than 70 per cent when the Japanese financial year commences on April 1.

There has been a push by BHP managing director, Marius Kloppers, for the iron ore industry and subsequently the coking coal industry to remove annual benchmark settlements which fix metallurgical contract prices for the year. The world's biggest iron ore exporter, Vale of Brazil, and Rio Tinto, have been campaigning for the change in pricing systems.