Due to the strong domestic demand for coal in China, it is reported that the coal price talks between Chinese exporters and South Korean buyers have entered stalemate. According to reports, the Chinese coal exporters have made an offer of $73/mt FOB China for thermal coal. However, the Korean buyers have refused this offer and stated that they would be prepared to accept $67.90/mt FOB, which is the level China agreed with Japan at the beginning of June. Meanwhile, Australian thermal coal prices have reached $71.64/mt FOB Newcastle, up $5/mt from early September.
On the other hand, the price of ex-China metallurgical coke reached around $270/mt FOB China at the end of September, up nearly $20/mt from the end of August. The import prices of ex-Australia coking coal increased nearly $5/mt from the end of August to $105/mt CIF China at the end of September. Meanwhile, India is also getting prepared for the annual coking coal and metallurgical coke negotiations with the Japanese steel mills. Currently, on the spot market in India the price of fine quality metallurgical coke has reached $290/mt while that of coking coal is up to $125/mt.
Deputy director of China's State Administration of Work Safety, Wang Xianzheng, said that coal production in China would increase by five percent year on year to 2.5 billion metric tons in 2007. The increase rate is lower than the average 11.5 percent of the last seven years. In spite of such high production, Chinese coal imports surpassed the country's exports for the first time this year mainly due to the requirements of power supply and the steel industry.