Singapore (Platts) - Anglo American has struck a deal with Japanese customers to sell coking coal at a record $330/mt FOB Australia for the April-June 2011 quarter, 46% higher than in the January-March quarter, market sources said Friday.
The deal comes at the same time as BHP Billiton is attempting to push through an unpopular shift from quarterly to monthly pricing. The transactions also mark a departure from the usual negotiation procedure, as BHP normally leads and agrees the first "benchmark" deal.
Anglo American has reportedly reached contract agreements with both of Japan's largest steelmakers, Nippon Steel and JFE Steel, though this could not be confirmed directly. No official comment or confirmation could immediately be obtained from Anglo American.
The headline price of $330/mt concerns Anglo American's flagship brand German Creek, a well-known premium low-volatile hard coking coal. It is unclear how the company will be pricing its other coals, including Moranbah North and Dawson. The transaction is likely to be welcomed by the steel industry, which has been universal in its rejection of BHP Billiton's proposed monthly pricing.
On the other hand, the deal commits the buyers to paying what is a historical record price for a period of three months, while those taking up BHP Billiton's offer are widely forecast to benefit from lower contract prices in May and June.
The sources did not mention how the thorny issue of carryover tonnage would be dealt with, following the severe floods in Queensland.
On Thursday, BHP Billiton-Mitsubishi Alliance made offers to Japanese steelmakers for its top-quality hard coking coal to be sold at $300/mt FOB Australia for April sales, and at $325/mt FOB for April-June sales, several market sources said.
The deal agreed closely matches latest spot metallurgical coal prices. Platts assessed Peak Downs Region at $330/mt FOB Australia on Thursday, while Premium Low Vol was assessed at $324/mt.
The price is 65% higher than in April-June 2010, when Anglo American agreed to sell its coking coal at $200/mt FOB.
German Creek has 71% coke strength after reaction, 19.5% volatile matter, 11% total moisture, 9% ash, 0.54% sulfur, 0.064% phosphorous and 250 ddpm fluidity.
Moranbah North has 65% CSR, 24.5% VM, 10% TM, 8.5% ash, 0.5% sulfur, 0.03% phosphorous and 1,700 ddpm fluidity. (sourced:Platts)
The deal comes at the same time as BHP Billiton is attempting to push through an unpopular shift from quarterly to monthly pricing. The transactions also mark a departure from the usual negotiation procedure, as BHP normally leads and agrees the first "benchmark" deal.
Anglo American has reportedly reached contract agreements with both of Japan's largest steelmakers, Nippon Steel and JFE Steel, though this could not be confirmed directly. No official comment or confirmation could immediately be obtained from Anglo American.
The headline price of $330/mt concerns Anglo American's flagship brand German Creek, a well-known premium low-volatile hard coking coal. It is unclear how the company will be pricing its other coals, including Moranbah North and Dawson. The transaction is likely to be welcomed by the steel industry, which has been universal in its rejection of BHP Billiton's proposed monthly pricing.
On the other hand, the deal commits the buyers to paying what is a historical record price for a period of three months, while those taking up BHP Billiton's offer are widely forecast to benefit from lower contract prices in May and June.
The sources did not mention how the thorny issue of carryover tonnage would be dealt with, following the severe floods in Queensland.
On Thursday, BHP Billiton-Mitsubishi Alliance made offers to Japanese steelmakers for its top-quality hard coking coal to be sold at $300/mt FOB Australia for April sales, and at $325/mt FOB for April-June sales, several market sources said.
The deal agreed closely matches latest spot metallurgical coal prices. Platts assessed Peak Downs Region at $330/mt FOB Australia on Thursday, while Premium Low Vol was assessed at $324/mt.
The price is 65% higher than in April-June 2010, when Anglo American agreed to sell its coking coal at $200/mt FOB.
German Creek has 71% coke strength after reaction, 19.5% volatile matter, 11% total moisture, 9% ash, 0.54% sulfur, 0.064% phosphorous and 250 ddpm fluidity.
Moranbah North has 65% CSR, 24.5% VM, 10% TM, 8.5% ash, 0.5% sulfur, 0.03% phosphorous and 1,700 ddpm fluidity. (sourced:Platts)
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