The December quarterly benchmark price for semi-soft coking coal has been set at $US130 per tonne, a rise of $US56 per tonne or 75 per cent above the September 2016 quarterly benchmark price, according to Stanmore Coal.
“The rapid rebound in coking coal prices is a timely reminder of the tightness of the market for this key ingredient for steel making,” Stanmore Coal managing director Nick Jorss said.
“The coking coal market has been significantly underinvested over recent years in response to low price signals and lacks a pipeline of advanced projects to address the depleting supply of what is essentially a scarce resource.
“With Isaac Plains now at steady state following the restart of operations this year, we are shipping in excess of 1.1Mtpa of coal on an annualised basis to our major customers in Asia.
‘We are mining additional coal via the highwall mining method and assessing further incremental expansion opportunities. As such Stanmore is positioned strongly to benefit from the recent upside in pricing.”
Under Stanmore Coal’s term contracts with major steel mills, each new quarterly price applies after any carry over tonnes from the previous quarter are delivered.
Stanmore Coal bought the open-cut Isaac Plains operation near Moranbah in central Queensland from Sumitomo Corporation and Vale, who had placed it in care and maintenance in 2014. Operations restarted in May this year.