(BN) South Africa Coal at Two-Year High as World Supplies


South Africa Coal at Two-Year High as World Supplies Disrupted
2010-12-20 12:16:20.869 GMT

By Alistair Holloway
Dec. 20 (Bloomberg) -- Coal from South Africa's Richards
Bay, the continent's biggest export facility for the fuel, rose
to the highest price in more than two years as demand increased
on supply disruptions elsewhere in the world.
Indonesia, the world's largest exporter of coal burned by
power stations, has suffered heavy rain caused by the La Nina
weather event, affecting commodity production. Australia's
Brisbane-based Macarthur Coal Ltd. said on Dec. 16 it had cut a
first-half profit forecast after wet weather disrupted output.
There's been "excessive rainfall in Australia, Indonesia
and Colombia," Amrita Sen, a London-based analyst with Barclays
Capital, said by phone today. "South Africa is one of the more
stable suppliers to the world market."
Export prices gained $2.37, or 2.2 percent, to an average
$112.37 a metric ton in the week to Dec. 17, according to IHS
McCloskey. That's the highest since the week ended Oct. 10,
2008. The data are an average based on daily price assessments
and a market survey.
Coal imports by China, the biggest user of the fuel, may
jump 60 percent in 2011 on strong demand from power plants, said
UOB Kay Hian Ltd. Imports may rise to 265 million tons from an
estimated 166 million tons this year, Helen Lau, a Hong Kong-
based coal analyst at the brokerage, said in an e-mailed note
today. That may reduce coal supplies to other Asian nations.
November coal shipments from Richards Bay fell 8.1 percent
from a year earlier and were 30 percent lower than in October,
according to data from the Richards Bay website. Owners of the
property, located on South Africa's northeastern coast, include
BHP Billiton Ltd., the world's biggest mining company, and Anglo
American Plc.
Benchmark European coal derivatives headed to their highest
close in 2010. Coal for delivery to Amsterdam, Rotterdam or
Antwerp with settlement next year rose $1.75, or 1.5 percent, to
$118.75 a ton at 11:25 a.m. in London.
The data are drawn from information supplied by ICAP Plc,
GFI Group Inc., Spectron Group Ltd., Credit Suisse Group AG, IHS
McCloskey, Bloomberg and Tradition Financial Services.

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--Editors: John Deane, Claudia Carpenter

To contact the editor responsible for this story:
Claudia Carpenter at +44-20-7330-7304 or