An Analysis of Steamig Coal Price Trends
1
An Analysis of Steaming Coal Price Trends
- Factors behind Price Fluctuations and Outlook -
Yoshimitsu MIMUROTO, Group Manager
Coal Research Group, International Cooperation Department
Introduction
The world’s steaming coal imports, 120 million
tons in 1980, have grown steadily to 334 million tons
in 1998. Japan is the largest importer, responsible
for some 20% of the world’s steaming coal imports.
Among exporters, Australia holds the largest share
of the world’s steaming coal exports at 25%. On
these accounts, to focus on Japan’ s coal import prices
from Australia appears rational in an attempt to ana-
lyze steaming coal price trends
This report is designed to analyze what factors
are influential on the Australian coal export price,
then consider its future price trends.
1. Factors Influential on Australian
Steaming Coal Export Prices
1-1 Historical price trends
Past records of changing Australian steaming
coal prices in FOB benchmark terms (those after 1998
are in reference price terms as discussed later in 1-3)
unveil that, since 1982, the prices have shown cyclic
fluctuations within the US$29.40 - 40.85/ton range
in Fig. 1-1. The price peaks emerged three times,
US$39.45/ton in 1982, US$40.85/ton in 1990, and
US$40.30/ton in 1995-96, all capped at around
US$40/ton. On the other hand, the floor prices,
US$29.40/ton in 1987 and US$34.35/ton in 1994,
kept declining for three consecutive years since 1997
and stood at US$29.95/ton as of 1999. While many
factors are considered interwoven in these price fluc-
tuations, more responsible ones than others are veri-
fied in this report. They include (1) exchange rates
of the Australian dollar , (2) fluctuations in coal stocks
(degree of supply and demand tightness), (3) coal
productivity (production cost), (4) the U.S. coal ex-
port trends, and (5) the price of oil as a rivaling fuel.
1-2 Impact of the exchange rate
1-2-1 Changing rates of the Australian dollar
The majority of the world’s coal trade markets
are making transactions in the U.S. currency (US$).
Fig. 1-1 FOB Benchmark Prices for Australian Steaming Coals (1980-99)
Benchmark price (Unit: US$/t)
(Source) Prepared from “Coal Information,” etc.
39.45
39.02
36.03
33.53
34.51
35 .6 5
39 .1 5
40 .8 5
39.85
38.90
36 .3 5
40 .3 0
40 .3 0
37.65
34.50
34.35
29.95
29.40
20
25
30
35
40
45
1980 1981 1982 1983 1984 1985 1986 1987 1988 19891990 1991 1992 1993 1994 1995 1996 1997 1998 1999
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