Japanese Sign Quarterly Deal with BHP
BHP Billiton reached a quarterly pricing
agreement with the Japanese for coking
coal. Press reports from the Pacific Rim
region say that BHP struck a deal with JFE
Holdings to supply an unknown amount of
coking coal for $200/metric ton (mt). A
price increase of 55% over the 2008-09
contract price of $129/mt and close to the
prevailing spot rate of US$220/mt. Terms
of the agreement are unclear, but it does
mark the first time a Japanese steelmaker
has been willing to depart from the annual
contract system, to one that more closely
tracks the spot market. In press statement,
BHP said it had reached terms for a significant
portion of its hard coking coal volumes
for 2010, based on a structural
change to shorter term market based pricing
for the contract period. The company
said it had reached an agreement with a
range of customers throughout Europe,
China, India and Japan. These settlements,
according to the company, reflect
its commitment to achieving market clearing
prices over time across all its bulk commodities.
As featured in Womp 2010 Vol 03 - www.womp-int.com