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Issue #591

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Terminal Operators

Air Cargo Quarterly

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2014 Media Kit

Prices rise on Colombian supply uncertainty

By: | at 12:12 PM | International Trade  

European coal prices rose on Monday, keeping above South African and Australian prices going into a third week, due to uncertainty about Colombian supplies and rising German power prices.

Coal cargoes for delivery in February into Europe’s main terminals in Amsterdam, Rotterdam and Antwerp (ARA) were bid at $85.75 a tonne on Monday afternoon, above last Friday’s close of $85.65 per tonne. South African cargoes traded at $84.40 and Australian shipments at around $82 per tonne.

European contracts were at a premium because of ongoing export troubles in Colombia, which is an important supplier to Europe.

“The situation in Colombia continues to pose a supply risk for Europe’s utilities, and on the demand side cold weather in Germany is pushing up power and coal prices,” a utility trader said.

The Colombian export facility of mining company Drummond shut down in January over the violation of a new environmental law, and sources said that Drummond has so far failed to find an alternative port from which to ship its coal.

The supply trouble in the physical market also affected European coal futures. API2 2015 contracts traded at $82.25 a tonne, almost half a dollar above Friday’s close.

German power prices for delivery in 2015 were trading at 36 euros ($49.15) per megawatt-hour (MWh), up from a closing price of around 35.90 euros a MWh last Friday.

Temperatures in continental Europe are expected to drop from the unseasonably warm daily average of almost 6 degrees Celsius towards the seasonal norm of around 2 degrees towards the end of the month, meteorologists said, lifting household energy demand.

($1 = 0.7324 euros)