Japan Major Steels Agree for Chinese Coking Coal Price

Japanese major integrated steel makers including Nippon Steel apparently agreed with Chinese suppliers for volume and price of coking coal shipment for fiscal 2006 ending March 2006. The purchase volume decreases by 1.55 million tonnes to 2.12 million tonnes from fiscal 2005 due to 75% decrease for lower priced soft-coking coal. The purchase prices are in line with international prices. With the settlement of Chinese coking coal, Japanese makers are closing the series of negotiation for coking coal for the year. The purchase price for semi- and soft-coking decreased by 30% while the price for hard coking coal dropped smaller under the tight supply.Japanese major steels’ purchase volume of Chinese hard coking coal increases by 350,000 tonnes to 1.17 million tonnes for fiscal 2006 from fiscal 2005 while the purchase volume is flat at 350,000 tonnes for semi-coking coal and decreases by 1.9 million tonnes to 600,000 tonnes for soft-coking coal. The purchase price is maximum US$ 115 per tonne for hard coking coal and around US$ 80 for semi-coking coal. The soft-coking coal purchase price is said to be just less than international high price of US$ 58. The soft-coking coal import will decrease widely due to price gap between international and Chinese domestic prices while the coking coal price kept high with small drop. Japanese steels finish the series of coal price negotiation started the end of 2005 after they had kept negotiating with Australian major supplier and broke down with the miner. The purchase price decreased from US$ 125 per tonne in fiscal 2005 to US$ 115 in fiscal 2006 for high quality hard coking coal and from US$ 80 to US$ 53-58 depending on the qualities. They purchase coal for pulverized coal injection at US$ 65 compared with US$ 100 in fiscal 2005.