While all the focus recently has been on iron ore’s crash and recovery, the price of Newcastle coal futures has been quietly crashing.
For weeks the daily move has been a loss of 10 cents here or 20 cents there. But last night saw an acceleration in the decline, with September Newcastle coal futures on ICE (Intercontinental Exchange) falling $1.35 tonne to $67.30.
Earlier this week Newcastle’s Port Waratah Coal Services, which runs the largest of Newcastle’s coal loaders, announced that 34 roles would be cut.
CEO Hennie du Plooy said in a press release accompanying the job cuts:
Port Waratah is just like any other service provider to the Hunter Valley coal industry – we are working very hard to ensure that the cost of our services are consistent with the very challenging economic conditions being experienced as a result of low coal prices and the strong Australian dollar.
Through-put at Port Waratah in June was still very strong and the year to date comparisons with 2013 are favourable. So this is just about the crashing price.
Not good news for Australia’s income or the Hunter.