Asia Coal-Australia thermal coal nudges up above $122/T - Reuters

Australia's thermal coal index nudged up to above $122 a tonne this week, remaining in a tight trading range that is likely to hold until Japan returns to its pre-quake
buying levels, brokers said on Tuesday.

Only one deal was reported so far this week with a contract for Newcastle coal in October agreed at $124.50 a tonne, a Singapore-based broker said, indicating some price recovery over the next three months.

Steam coal prices in Australia finished the second quarter little changed but have shed nearly 7 percent so far this year, after the deadly earthquake and tsunami in Japan slashed coal demand in the world's largest consumer of steam coal, which is also the largest buyer of Australian coal.

Thermal coal on the globalCOAL Newcastle index for the week so far was $122.25 per tonne, up from $120.97 on Friday.

Sales have been thin in recent weeks, with Japanese and Chinese buyers out of the market, and they are likely to stay away until around September, when winter buying starts.

"The market has been stagnate at the $120 level for some time," a coal broker said. "There is a lot of coal available right now and nothing really driving the market with Japan away."

Top thermal coal exporter Xstrata was close to an agreement with Japanese utilities for the July-start annual contract, with talk of the settlement price around $127 a tonne, according to three brokers.