Goldman Raises Coking Prices Chinese Exports Knock Newcastle Coal Prices Down From Record BUSINESS ASIA By Bloomberg

Goldman Sachs JBWere, the Australian affiliate of the largest securities firm in the world, raised its contract coking coal price forecasts 17 percent, pacing higher cash prices for the steel- making ingredient from India.

The annual contract price of coking coal may rise to a record $140 a metric ton in the 12 months from April 1, from $98 this year, the brokerage said. It had forecast $120 a ton.

Port and rail congestion in Australia, the largest exporter of coal in the world, have restricted supply as Asian demand rises.

BHP Billiton, the largest mining company in the world, and rivals start talks with Japanese and Chinese steel makers to set annual contract prices for coking coal and iron ore this month.

“We believe Australian coal suppliers are extremely well positioned to secure significantly higher contract prices,” two Goldman analysts, Malcolm Southwood and Paul Gray, said Friday in a report. There was “no quick fix in sight for the severe congestion afflicting Australian coal supply chains and no let up in demand,” they said.

Australian exporters recently sold coal to Indian buyers on the spot market at $165 a ton, the report said.

Energy, or thermal coal, used in power stations, may rise 35 percent to $75 a ton in 2008, from $56 a ton this year, Goldman said. The broker had forecast a price of $68 a ton.

Originally published by Bloomberg News.

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