Asia Coal-Prices jump to new record as supply crunch bites

By Fayen Wong

SYDNEY, Feb 4 (Reuters) - Coal prices at Australia's
Newcastle port, a benchmark for Asian coal prices, jumped to a
record of more than $115 a tonne as a global supply crunch
worsened after a series of supply disruptions in key coal
exporting nations.

Thermal coal prices jumped $23.09 from a week earlier to
$116.44 per tonne, globalCOAL's NEWC weekly index showed in the
week ended Feb. 1, based on free-on-board (FOB) prices loaded
at Newcastle port.

Thermal coal prices, used for power generation, were also
buoyed by physical trades on Friday. A 15,000 tonne parcel of
Australian coal for March delivery traded at a $130 a tonne,
and a 35,000 tonne Newcastle parcel also for March loading
traded at $129 a tonne FOB.

Coal prices have rocketed on China's temporary two-month
export halt, South African power shortages and force majeure
declarations issued by Australian coal producers.

Ensham Resources Pty Ltd and BHP Billiton Mitsubishi
Alliance were among the four Australian miners that have issued
force majeure on shipments after heavy rains flooded their
mines.

"Spot coal prices will continue to rise. It doesn't look
like there are many bearish factors in sight to push prices
down," said Mark Pervan, a resource analyst at the Australia &
New Zealand (ANZ) Banking Group.

South Africa, which experienced a severe power crisis last
week that forced the the shutdown of several major mines, is
seeking around 11 million tonnes of additional coal supply for
2008 to build bigger stocks and prevent power cuts, state
utility Eskom [ESCJ.UL] said on Friday [nL01416183].

South African coal mines were also making slow progress in
bringing back production after Eskom allowed them only limited
increases to their electricity consumption [ID:nL01792485].

After first saying it would be able to meet 90 percent of
the needs of the gold, platinum, diamond and coal miners, Eskom
said on Thursday that generating plant breakdowns meant it
could supply only 80 percent of their needs.

The supply disruptions in China and Australia have sent
many Asian utilities, particularly South Korean power plants,
to scramble to the market to find additional tonnage.

But producers and traders have said the supply of coal was
extremely tight from most exporting nations, and some have
estimated a global shortage of at least 5 million tonnes.

The globalCOAL week-to-date index is calculated based on
bids, offers as well as actual transactions in the next 90-day
period. If there are no trades or bids and offers on a
particular day, the index will be calculated based on bid and
offers of the preceding day.
(Editing by James Thornhill)