PERTH, Australia -- Coal prices for power generators in Australia, a benchmark for Asia, dropped about $10 to below $152 a ton in the latest week, dragged down by heavy losses in the international oil and gas markets.
Producers spanning from Indonesia, South Africa and Australia have also been forced to cut their price offers in recent coal tenders in Asia, as some utilities reduced coal usage and switched back to gas, a cleaner-burning fuel.
Thermal coal prices fell $9.70 from a week earlier to $151.65 a ton, the globalCOAL's NEWC weekly index showed in the week ended Sept. 13, based on prices at Australia's Newcastle port, the world's largest coal export terminal.
"I think the coal price index has been taking cue from the oil and gas prices," said Gerard Burg, a commodities analyst from National Australian Bank.
"And with gas prices having fallen so sharply in the past few weeks, many European utilities could be cutting back on coal."
Coal prices have fallen despite bullish demand on a string of coal tenders in Asia and news of supply disruptions in Indonesia, the world's largest thermal coal exporter.
Thailand's Banpu has also reviewed its export contract with Malaysia's power firm Tenaga Nasional Berhad, which has resulted in Banpu reducing its tonnage obligation but with no changes to prices, a source with knowledge of the negotiations told Reuters.
Some market participants said there could be more supply disruptions from Indonesia if producers failed to agree on prices with buyers, which range from large commodities firm such as Glencore to endusers.
Separately, Malaysia's TNB last week awarded 10 bituminous coal cargoes in a tender seeking six shipments, with one October-loading parcel from South Africa priced around $160 a ton on a free-on-board basis.
The remaining shipments are from Indonesia and Australia, said a source familiar with the deal.