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Friday, 27 November 09
EXXARO SEES HIGH COAL DEMAND RAISING PRICES


Reuters reported that, South African diversified miner Exxaro Resources said on Thursday it expected coal prices to rise to between $70 and $75 per tonne in 2010 from around $65 per tonne this year due to rising global demand.

Exxaro's executive general manager for business growth, Ernst Venter, said coal demand had started to rise on the world market, with India becoming a major market, particularly for steam coal.

"The recession is over and demand is now rising and as a result prices will also rise," Venter told Reuters.

Venter separately told journalists that 95 percent of Exxaro's coal was still going to Europe and that the company's plans to export up to 7.5 million tonnes in 2009 would be hampered by logistical problems and a lack of bigger port capacity at the Richards Bay Coal Terminal (RBCT).

"Europe is still a good market in terms of our coal, at least we could look at the Indian market as well. We have plans for the future and especially the Indian market," Venter said.

"We could have exported this year about 7.2-7.5 million tonnes but we will get to about 5 million."

RBCT had said it would expand its capacity to 91 million tonnes by October, but logistics group Transnet has said it signed contracts with coal producers to rail only up to 70 million tonnes of coal to the port this year.

Exxaro has said it would consider using private haulers if Transnet failed to bring all its coal to the port.

Venter said the RBCT could export up to 67 million tonnes of coal this year and raise exports to about 74 million tonnes in 2010.
Source: Reuters



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