Australia’s metallurgical coal export earnings are forecast to decline from A$54 billion in 2023-24 to A$42 billion by 2025-26, due to a downward revision in export volumes and a downward revision to forecast prices, according to the quarterly outlook report by the Australian government’s Department of Industry, Science and Resources.
Prices declined from US$233/mt at the start of July to US$195/mt by the end of August this year. Prices are expected to average around the US$200/mt a mark through to 2026. Significant price volatility is to be expected throughout the forecast period. On the supply side, volatility is expected given illiquidity and supply concentration in the Australian spot market. La Niña weather conditions in Queensland and New South Wales could also disrupt mining operations. On the demand side, opportunistic Chinese and Indian demand in the spot market is expected to continue, as buyers look to maximize profits by buying Australian coal when prices plus freight are below domestic prices.
The Australian premium hard coking coal price is forecast to fall from an estimated US$253/mt in 2024 to US$205/mt by 2026.
Also, metallurgical coal exports from Australia are expected to rise from an estimated 151 million mt in 2023-24 to 175 million mt in 2025-26. A potential recurrence of the La Niña cycle presents a risk to supply.
