<p>Benchmark Australian spot thermal coal prices fell for the second successive week last week as China continued to export and a reduction in Australian port congestion eased a supply squeeze in the Pacific.</p> <p>The price of coal for delivery at Newcastle fell 2%, or US$1.38, to US$68.57 per tonne on free-on-board basis in the week ended August 24, according to the global COAL NEWC index.</p> <p>Prices reached a record US$72.37 per tonne two weeks ago, breaking the previous record of US$70.88 set in June as northern summer demand for power generation soared.</p> <p>Chinese producers continued to export more coal to the Pacific market after Chinese exports surged nearly 50% in June from May, after an agreement with Japanese utilities on the 2007 term export price, reversing China’s status as a net importer.</p> <p>Coal exports in Newcastle also jumped 13% to 1.67m tonnes in the week ending August 27, as port congestion eased.</p> <p>Demand for coal for power generation in China, Japan and South Korea reaches its peak in July and August as air-conditioning usage rises.</p> <p>Supplies tightened this season as Indonesian producers called <em>force majeure</em> on exports amid heavy rains, while an earthquake in Japan on July 16 led to Tokyo Electric Power increasing use of coal in power generators to compensate for the closure of a nuclear plant.</p> <p>Indonesian producer Banpu, which operates the Jorong mine in Indonesia’s Kalimantan region, expects to resume normal operations next month.</p> <p>These factors helped to support a rise in Australian coal prices this summer, adding to the ongoing problem of port congestion.</p> <p>Gloucester Coal cited port congestion at Newcastle as the biggest factor in a 55% drop in the miner’s profit in 2006ባ.</p> <p>The Newcastle queue, which reached a record of 79 two months ago, now remains at 50 vessels.</p> <p>The queue is expected to fall to about 30 in the next two months. </p> <p>The decline in net profit was to $18m, in spite of a 13% increase in its coal tonnages, Gloucester Coal said.</p> <p>Higher demurrage charges, as bulkers waited in the offshore queues for long periods before loading, ate into profits.</p> <p>The company said it was getting a high price for its coking coal.</p> <p>The company is seeking growth opportunities outside of the Gloucester Basin so that it is not totally dependent on a single mine.</p> <br />
