Coal price will improve by April, industry experts say

The coal price is expected to reignite, a Brisbane conference has heard.
The coal price is expected to reignite, a Brisbane conference has heard. Peter Holt

COAL is coming back.

During perhaps the most popular session in Brisbane's Major Projects Conference, speakers from a mining giant and stockbroking expert backed the future of the black mineral.

GVK Hancock Coal chief development officer Justin Crotty said despite being years away from delivering, GVK had strong demand for coal from its Alpha project in the Galilee Basin.

Mr Crotty even gave the timing - coal prices would improve from April next year.

He said if prices did not rise before then, mining companies would cut production.

If supply falls and demand remains the same, prices would have to increase.

"We have demand for 43 million tonnes," he told the Brisbane Major Projects Conference.

"It's a good indicator that (buyers) have confidence in coal."

His comments were timely, coming as HSBC released figures showing Chinese manufacturing was to hit a 13-month high.

HSBC chief economist on China Hongbin Qu said the report "confirmed that the economic recovery continues to gain momentum towards the year's end".

Manufacturing in China has been closely watched as the coal industry waited for signs of improving demand.

During his speech, Mr Crotty said industry analysis for GVK showed all but two thermal coal mines in Australia were struggling.

With such strong interest in GVK Hancock's coal, he said it showed "prices will improve and those thermal coal mines underwater will experience better times".

"We're near the bottom and it's only up from here."

RBS Morgans chief economist Michael Knox said of all commodities, oil prices always hit the bottom first before beginning to rise, followed by metals including iron ore.

Metallurgical coal - used for steel production - was always later, followed by thermal coal.

"In coming months you will see a base in metallurgical coal," he said.

"You'll be able to say in a year's time that the low in metallurgical coal is behind us and you will see a rally (in prices).

"Six months later you will see a rally in thermal coal."

The Bowen Basin contains almost all Queensland's metallurgical coal.

The Surat Basin to the west of Toowoomba and the Galilee Basin, west of Rockhampton, are emerging as major centres for mining thermal coal.

Topics:  brisbane major projects conference, coal, coal price, gvk hancock coal, rockhampton



Local Real Estate

Featured Real Estate
D.I.Y. OR INSTALLED HOME... $9500.00 From
Mobile Home Fully self contained granny flat or mod homes.  D.I.Y $9.5k or $12.5K ...
Luxury Waterfront... $1,200,000
House 4 3 2
LARGE HOME WITH POOL and... $360 Weekly
House 3 1 2
AMAZING INVESTMENT... Auction
House 3 2 3

Featured Jobs

Rockhampton jobs listed daily

Featured Jobs
PAYROLL/HR OFFICER Rockhampton Full Time
Medical Receptionist &... Rockhampton Part Time
ASSEMBLER/ HANDYMAN Rockhampton Full Time
EXPERIENCED CHEF Blackwater Full Time


Local Partners

LATEST DEALS AND OFFERS

View today's ePaper!

Read the digital edition
Learn More

MAD HATTERS HIGH TEA

POD TAG PRO-AM Golf Classic
Learn More

Cars For Sale

Find cars for sale online now.
Learn More

Subscription Sale

Subscribe now for $1 for 14 days.
Learn More

Local Profile

Stay Connected

Get the news as it happens, in your inbox

You can change the newsletters you are subscribed to when you edit your profile

Edit Profile


Special Offers

Latest deals and offers

Horoscopes

Cancer

Your partner may be feeling that your career directives have temporarily pulled you away from the relationship.  You may have limited time...

read more

Marketplace

Special Offers & Promotions

Compare & Save