The consequences for the award are obvious

Irreplaceable energy of the blast, coal coke was one of the mineral resources that have most benefited from rising prices of raw materials cycle. Below 60 dollars in 2004, he flew to peak at $ 300 per ton this year, worn by the market in great shape of steel. The sudden reversal of the environment, the demand for steel products appeared to it have affected only moderately. Then, as iron ore, bad news are chained.

Last week, the Australian producer Macarthur Coal said that his client and shareholder to 19.9 ArcelorMittal had reduced its levels of coal to coke in the fourth quarter. The world leader in the steel and its competitor Corus decided to drop by 30 and over their respective flows in the fourth quarter. In total, the productive sections in the steel industry could reach 12 to 15 between October and December. The consequences are dramatic for the producers and the recovery of raw materials. Very quickly, per tonne of steel recovery collapsed from 600-800 dollars per tonne to 100-150 dollars. Purchased iron ore cash by Chinese steelmakers from nearly $ 200 to $ 55-65. On Coal Coke, Macquarie Bank now predicts the formation in the short term to a large surplus of the offer after a long period of "chronic" shortages In 2008, the Australian Bank considers that the surplus will be 11 million tonnes after a deficit of 4 million tonnes last year.

Low Chinese demand

Change suddenly décor is perfectly readable in the cash market. In the first half, the price of coal coke from Australia spot had singed up to just 400 dollars per tonne. That is about $ 100 more than the contract price for 2008 of $ 300 per tonne. Today, this gap has been fully resorbed. More than 95 of coking coal sales are carried out under these annual contracts. The fall in prices is likely to be accelerated by the minor role that China plays in the international market. Chinese steelmakers are very important little coal to coke. And the country, despite its surpluses, is an exporter of second plan on the basis of quotas established by Beijing. Global demand is very dependent on the Japan (28 of the total) and Europe (24). However, unlike China, the old Continent and the Japanese archipelago are subjected to a severe industrial crisis. If China was to the part of the quotas on exports, the situation could worsen more. "Potential molt China in exporting country net is a key element of concern," confirm the UBS economists, which in turn, build on the appearance of significant surpluses of coking coal next year. The Swiss Bank estimated that in 2009 the world steel production will be 420 million tonnes. Which will result in a decline in the use of coal to coke of 70 million tonnes in the low word.

The consequences for the award are obvious. UBS predicts annual contracts to 180 dollars per tonne for 2009 and $ 130 for 2010. The ANZ Bank on their decline of 50 next year, after rising by 200 in 2008. About Macquarie Bank, he just set at $ 140 per ton ( 60) the contract price envisaged for next year.