We may be seeing the beginnings of a bottom for iron ore but the same can’t yet be said for coking coal. From ANZ:
Spot thermal coal fell 2.3% to USD86.37 last week, while coking coal shed 5.4% to USD153.20/t. Coking coal prices continue to drift lower as buyers stay on the sidelines awaiting the results of Q4 contract negotiations. The expectation remains for these to conclude at the USD170-175/t mark. In trade data, Australian exports of thermal coal hit a record high of 15.85mt (+13.8% m/m) in July, buoyed by increased volumes from Japan and South Korea, according to the ABS. However, July hard coking coal exports fell to 6.14mt (22.75% m/m) as China stayed away for the first time since December 2008. Iron ore finished the week down slightly at USD89/t – although this was mostly due to Friday’s USD2.00 gain following China’s approvals of infrastructure projects.
Iron ore and coking coal tend to track one another so there may be a better week ahead for coking coal.
