Washington(Platts): International coal markets were mixed on news of Friday's catastrophic earthquake in Japan, even as many participants tried to assess the potential effects of the disaster and resulting tsunamis.
The country imported about 165 million short tons of coal in 2009, making it the largest importer of both steam and metallurgical coal, according to estimates by the International Energy Agency. The quake comes at a time when Pacific coal markets have been particularly sensitive because of flooding and a recent typhoon that has curtailed Australian exports.
Coal market participants in the US and abroad said Friday that it was simply too soon to know how the earthquake might affect the country's coal-importing and coal-burning infrastructure.
The speculation drove up prices as Platts assessed Q2-11 Newcastle coal at $128.25/mt on Friday, up $2.35/mt. (See story, 2023 GMT). Coking coal prices across the Asia-Pacific markets, meanwhile, slipped.
Still, many were keeping an eye on the status of Japan's nuclear power plants, steel mills and import terminals.
"The Japanese are heavily dependent on coal-fired generation," Ted O'Brien, vice president of Doyle Trading Consultants in New York, said. "You could see thermal demand ramp up if there is any structural damage to the nuclear industry, but that is all dependent on their ability to import the coal."
While steel mills could likely continue operating with damage -- or, at least, continue stockpiling coal -- more sensitive nuclear plants had automatically shut down after the 8.9-magnitude quake that hit northeastern Japan at 2:46 p.m. JST (0546 GMT).
All seven units of Tokyo Electric Power's Kashiwazaki-Kariwa 8.2-GW nuclear power plant were shut down after a 2007 quake, the fourth of which was just reopened for commercial operation in February. Eleven of the country's 28 nuclear units had been shut down as of 2:30 p.m. GMT, according to the Nuclear and Industrial Safety Agency of Japan.
Coal accounted for 22% of the country's total energy consumption in 2007, ranking it second behind oil, according to the US Energy Information Administration.
Japanese steel producers, meanwhile, told Platts that at least one plant had been unaffected by the quake; while others had been closed, were operating at reduced rates or could not be reached by telephone. (See story, 1445 GMT)
Lower steel production could mean that coking coal is redirected to other countries, though reconstruction efforts would eventually increase the amount of domestic consumption, market sources said. The country is second only to China in both pig iron and crude steel production.
"That steel production will have to resurface elsewhere around the world and the coking coal demand that would have been taken by Japan would be supplemented by other countries," O'Brien said.
Japan ranked ninth among importers of US coal through the first three quarters of 2010, according to the Energy Information Administration. The 4.1 million short tons it imported from US producers accounted for about 4% of total US coal exports during that time.
--Peter Gartrell, Platts
The country imported about 165 million short tons of coal in 2009, making it the largest importer of both steam and metallurgical coal, according to estimates by the International Energy Agency. The quake comes at a time when Pacific coal markets have been particularly sensitive because of flooding and a recent typhoon that has curtailed Australian exports.
Coal market participants in the US and abroad said Friday that it was simply too soon to know how the earthquake might affect the country's coal-importing and coal-burning infrastructure.
The speculation drove up prices as Platts assessed Q2-11 Newcastle coal at $128.25/mt on Friday, up $2.35/mt. (See story, 2023 GMT). Coking coal prices across the Asia-Pacific markets, meanwhile, slipped.
Still, many were keeping an eye on the status of Japan's nuclear power plants, steel mills and import terminals.
"The Japanese are heavily dependent on coal-fired generation," Ted O'Brien, vice president of Doyle Trading Consultants in New York, said. "You could see thermal demand ramp up if there is any structural damage to the nuclear industry, but that is all dependent on their ability to import the coal."
While steel mills could likely continue operating with damage -- or, at least, continue stockpiling coal -- more sensitive nuclear plants had automatically shut down after the 8.9-magnitude quake that hit northeastern Japan at 2:46 p.m. JST (0546 GMT).
All seven units of Tokyo Electric Power's Kashiwazaki-Kariwa 8.2-GW nuclear power plant were shut down after a 2007 quake, the fourth of which was just reopened for commercial operation in February. Eleven of the country's 28 nuclear units had been shut down as of 2:30 p.m. GMT, according to the Nuclear and Industrial Safety Agency of Japan.
Coal accounted for 22% of the country's total energy consumption in 2007, ranking it second behind oil, according to the US Energy Information Administration.
Japanese steel producers, meanwhile, told Platts that at least one plant had been unaffected by the quake; while others had been closed, were operating at reduced rates or could not be reached by telephone. (See story, 1445 GMT)
Lower steel production could mean that coking coal is redirected to other countries, though reconstruction efforts would eventually increase the amount of domestic consumption, market sources said. The country is second only to China in both pig iron and crude steel production.
"That steel production will have to resurface elsewhere around the world and the coking coal demand that would have been taken by Japan would be supplemented by other countries," O'Brien said.
Japan ranked ninth among importers of US coal through the first three quarters of 2010, according to the Energy Information Administration. The 4.1 million short tons it imported from US producers accounted for about 4% of total US coal exports during that time.
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