COMMENT: Peabody cuts unlikely to affect quarterly coking coal price

The timing of Peabody Energy’s announcement of cuts in coking coal output raised some eyebrows as all eyes have been on the quarterly benchmark price negotiations in Japan over the past week.

The USA-headquartered coal producer said that production at its North Goonyella mine in Queensland, Australia, would be cut by 1.5 million short tons per year in an attempt to “lower costs, improve cash flows and increase productivity”.
No word had been heard from Japan about the quarterly price at the time of writing, but sources told Steel First that they expected Peabody’s move to have little effect.

“This could definitely be a bargaining chip for producers during the [quarterly] negotiations, but the final results may see little difference because the oversupplied market fundamental hasn’t changed,”...


Daisy Tseng

June 04, 2015

17:10 GMT