Coal prices surge to catch up with oil

SYDNEY, Jan 30, 2008 (AFP) – Floods in Australia, freezing weather in China and transport bottlenecks in Indonesia have helped stoke a sharp rise in the price of coal, putting pressure on Asian consumer industries. Soaring demand from China and India as their economies steam ahead has also combined to push the cost of the fuel to record highs, analysts say.

Australia’s Newcastle coal, the regional benchmark, rose to more than 90 US dollars a tonne in January from 75 dollars in October according to the globalCOAL trading platform, an increase of 20 percent in four months.

But even as Japanese steelmakers and South Korean power companies feel the squeeze, producers are struggling to capitalise fully on the price surge.

Australian coal miner Coal & Allied Industries Ltd said Tuesday its 2007 bottomline was almost halved to 97.16 million US dollars amid infrastructure constraints and flooding in the key Hunter Valley mining region.

Australia is the world’s biggest exporter of sea-borne coal but producers will miss out on billions of dollars in revenue in the next 10 years due to inadequate rail and port infrastructure, analysts say.

Ships are queuing for weeks to load coal at ports in Queenslan