Newcastle cargo prices for thermal coal have jumped12.8% to $82 per tonne since the end of September, due in large part to China'sproduction cuts and its recently imposed stringent land transport rules,Reuters reported Oct. 4.
"The new rules are expected to effectively crackdown on freight over-loading by setting up higher standards, imposing strongerpenalty and enhancing inspections," the report quoted financial servicesfirm Citigroup as stating. Morgan Stanley projected a"short-term bear point for all coal prices" amid China's recentmeasures to bolsterdomestic production, notably in October and November, said the report.
Factors such as firm demand from developed marketslike South Korea, along with output cuts in Indonesia and Australia couldoffset China's move to improve yield, and are also considered responsible forthe recovery of other physical coal price benchmarks, Reuters wrote.
Since the end of September, South African Richards Bayprompt cargo prices rose 10% to $73.30 per tonne, their highest level sinceJuly 2014, while coal import prices into Amsterdam, Rotterdam or Antwerpclimbed 12.9%, to $71 per tonne, their highest since December 2014, accordingto the report.
Moreover, the futures market has also been affected bythe frenzied price rebound, with API2 2017 coal prices surging 74% thisyear at $63.40 a tonne.