Thermal coal prices may gain in the third quarter after wet weather in Australia’s Hunter Valley crimped production amid signs demand is reviving in Asia, Citigroup Inc. said.
Thermal coal prices for immediate delivery may rise back above $130 a metric ton, Citigroup analysts led by Daniel Hynes said in a report. Power-station coal prices at Australia’s Newcastle port, an Asian benchmark, were $119.19 a metric ton, according to the globalCOAL NEWC Index.
“Wet weather has hit the coal market again, with Hunter Valley thermal coal mines struggling to overcome the latest deluge of rain during this wet season,” Hynes said in the June 17 report. “This is all coming at a time when Asian buyers look like picking up their buying activity.”