Expansion delays at Aussie terminal could cut coal exports
Exports from Australia's Dalrymple Bay coal terminal are set to decline by about 10 per cent this year due to delays to expansion work.
Less coal exported from the terminal, located in Queensland state, would likely lead to higher prices paid for coal in Asia, where supplies are already strained thanks to cutbacks by Chinese exporters, according to analysts.
Babcock & Brown Infrastructure, which owns the terminal, said it could take up to Mid-September before two new coal-handling facilities were assembled.
It had hoped to have the work completed by July.
'We think there is a fairly realistic chance that construction of the coal-handling terminal will be delayed until mid-September or thereabouts,' Babcock chief operating officer for transport infrastructure, Jeff Pollock, told Reuters. 'The delays will probably cut shipments but it's still too early to give numbers on the impact of the delay,' he added.
Babcock & Brown Infrastructure is a unit of investment bank Babcock & Brown.
Credit Suisse said in a report that the delay could cut 2007 exports by as much as six million tonnes, or about 10 per cent of its annual capacity of 60 million tonnes.
Australia's efforts to boost coal exports have been hindered by infrastructure constraints.
Infrastructure constraints south of Dalrymple Bay at Newcastle, the world's largest coal export terminal, have left a growing backlog of ships waiting to load coal.
Industry sources have said Australian coal miners, taking advantage of limited supplies, were looking to lift Asian thermal coal contract prices for 2007 to between US$54-US$55 a tonne, compared with the benchmark export price of US$52.50 a tonne last year.
Mr Pollock said coal producers, such as Rio Tinto and Macarthur Coal, have met on Wednesday to review their shipping programmes to limit the impact of the delay.
Miners are currently working with an allocation of 54.5 million tonnes at Dalrymple Bay, compared with full capacity of 60 million tonnes, Mr Pollock said.
Upon the completion of its expansion programme, annual capacity at Dalrymple Bay coal terminal would increase to 68 million tonnes by the end of 2007 and to 85 million tonnes by the end of 2008.
Less coal exported from the terminal, located in Queensland state, would likely lead to higher prices paid for coal in Asia, where supplies are already strained thanks to cutbacks by Chinese exporters, according to analysts.
Babcock & Brown Infrastructure, which owns the terminal, said it could take up to Mid-September before two new coal-handling facilities were assembled.
It had hoped to have the work completed by July.
'We think there is a fairly realistic chance that construction of the coal-handling terminal will be delayed until mid-September or thereabouts,' Babcock chief operating officer for transport infrastructure, Jeff Pollock, told Reuters. 'The delays will probably cut shipments but it's still too early to give numbers on the impact of the delay,' he added.
Babcock & Brown Infrastructure is a unit of investment bank Babcock & Brown.
Credit Suisse said in a report that the delay could cut 2007 exports by as much as six million tonnes, or about 10 per cent of its annual capacity of 60 million tonnes.
Australia's efforts to boost coal exports have been hindered by infrastructure constraints.
Infrastructure constraints south of Dalrymple Bay at Newcastle, the world's largest coal export terminal, have left a growing backlog of ships waiting to load coal.
Industry sources have said Australian coal miners, taking advantage of limited supplies, were looking to lift Asian thermal coal contract prices for 2007 to between US$54-US$55 a tonne, compared with the benchmark export price of US$52.50 a tonne last year.
Mr Pollock said coal producers, such as Rio Tinto and Macarthur Coal, have met on Wednesday to review their shipping programmes to limit the impact of the delay.
Miners are currently working with an allocation of 54.5 million tonnes at Dalrymple Bay, compared with full capacity of 60 million tonnes, Mr Pollock said.
Upon the completion of its expansion programme, annual capacity at Dalrymple Bay coal terminal would increase to 68 million tonnes by the end of 2007 and to 85 million tonnes by the end of 2008.
