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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: energyplay who wrote (46226)	2/13/2004 4:18:19 PM
From: Raymond Duray	Respond to of 74559

ep, Thanks. You offer excellent advice. :)

To: energyplay who wrote (46226)	2/13/2004 7:08:51 PM
From: elmatador	Respond to of 74559

Thanks, eplay. Will tell my friend in Brazil to do the same with mine, this weekend.

To: energyplay who wrote (46226)	2/13/2004 7:09:13 PM
From: elmatador	Respond to of 74559

Coal dusts down its dirty image and shines By Kevin Morrison Published: February 13 2004 15:24 \| Last Updated: February 13 2004 15:24 Coal is shedding its dirty cheap image and becoming a much sought-after commodity with customers ready to pay record prices for the black nuggets. The increase in coal prices has little to do with market speculation as the majority of coal prices are set through long term contracts. But the high prices have prompted the gradual emergence of a spot market as producers seek to take advantage of strong demand from steel producers. The increase in demand has caught many coking coal producers by surprise and there are growing fears of shortages in the commodity as production capacity has failed to keep pace with the upswing in demand. Jim Lennon, metals analyst at Macquarie Bank, said the shortage of coking coal follows fears of a collapse in Chinese exports, as it diverts more of its coal production into domestic usage to satisfy the needs of the country's expanded steel making industry. Mr Lennon said this has caused panic buying with reports of Chinese coking coal export prices reaching up to $400 per tonne, before shipping freight costs. This is almost double the price in December, and up from less than $70 a tonne three years ago. It also overshadows the 28 per cent price increase this week by BHP Billiton, the world's largest mining company, for its coking coal sale contracts to Japanese steelmakers for the year starting on April 1. Xstrata, the London-listed miner, has so far not settled any long term contracts as it prefers to take advantage of the higher spot price, analysts said. "The shortage of coke is forcing steelmakers to consider productions cuts," said Mr Lennon. Some US and Indian producers have already trimmed output, while the Italian steelmaker Riva has indicated that it was looking at closing a significant amount of its production capacity due to the shortage of coke, he said. However, large parts of the steel industry have remained immune from the hike in spot coking coal prices as many are still under long term contracts negotiated last year before the shortage fears. At the same time, producers have raised steel prices. Nucor, the largest US steel producer, said it had increased prices due to higher raw material costs. US hot rolled coil steel, the most widely quoted steel price, reached almost $500 a tonne recently from less than $200 a tonne three years ago, said Mr Lennon. Steel scrap prices are quoted at about $350 a tonne, a 75 per cent increase on three months ago.