Thermal coal prices drops 6.8%

Thermal coal prices in Newcastle Port, Australia, for the week ended February 5th, 2010 dropped 6.8% to US$91.83 per ton. The commodity reached its peak two weeks ago at US$99.26 per ton.

Newcastle Port is the benchmark for Asian market. GlobalCoal's monthly NEWC Index has surged from US$71.74 per ton in October 2009 to US$95.2/ton last month. That was the highest level for almost 14 months. RB Index, which tracked thermal coal prices in Richard Bay port, South Africa, reached US$86.02 per ton last month, while DES ARA Index (Europe) at US$85.99 per ton.
Coal stocks closed mainly lower in the region on Friday. On IDX, Indo Tambangraya and Indika dropped 6% respectively, while Bumi Resources lost 4.85%, Bukit Asam -4.15%, and Adaro -3.63%. Trading on coal stocks was substantial. Total trading value of coal-related stocks was above Rp1.5 trillion.
They're not alone. China Coal and Shenhua crashed 6.53% and 4.71% respectively in Hong Kong, while Straits Asia conceded 6% on SGX and BHP -3.51% on ASX. Xstrata, the world's largest thermal coal exporter, lost 4.65% in London.

In the meantime, crude oil lost nearly 3% to settle at $71.19 on the New York Mercantile Exchange yesterday. Oil dropped as low as US$69.5 per barrel earlier Friday. As a result, crude has now dropped over 14% from its recent peak early last month (US$83/barrel).

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