Washington: Thermal coal may outpace oil and gas this year, rising more than 30 per cent to a record, as demand from China and India accelerates and Japan boosts imports to make up for nuclear power lost after the March earthquake.
Prices at the Australian port of Newcastle, a benchmark for Asia, may average $130 (Dh477.46) a metric tonne in 2011, the median forecast of seven analysts surveyed by Bloomberg shows.
That compares with $99 a tonne last year, according to data compiled by Bloomberg and IHS McCloskey, a Petersfield, England-based researcher.
New York crude futures are forecast to rise 26 per cent next year, while US natural gas will be unchanged.
Demand for coal is increasing in China and India as the countries look to fuel economies that are outpacing the rest of the world.
China's purchases may rise by 7.8 per cent in 2011, while India's may climb 28 per cent, Societe Generale said last month.
Japan may consume as much as one million extra tonnes this year as the country turns to coal-fired plants to make up for the loss of nuclear generation, according to Deutsche Bank.
"The demand story for thermal coal is going to look quite strong," said Mark Pervan, head of commodity research at Australia and New Zealand Banking Group in Melbourne, who estimated contract prices for the 12 months starting April 1 would reach $130 a tonne.
Accelerated increase
"This year we're going to see quite an accelerated increase in demand from India. China will again be a strong contributor."
Thermal coal will average $132 a tonne this year and $145 in 2012 as demand from Japanese utilities for fuel with high-energy content rises, Daniel Brebner, an analyst for Deutsche Bank in London, said in an April 8 report.
Price estimates ranged from $118 to $150 a tonne in the survey.
Benchmark West Texas Intermediate crude futures may average $100.14 a barrel in 2011 from $79.61 last year, according to the average forecast of 37 analysts surveyed by Bloomberg, with the most recent predictions given the heaviest weightings.
