Coal dust settles, but the point’s been made

Loading operations at Dalrymple Bay and Hay Point coal terminals have returned to closer to normal conditions after being hit by Cyclone Ului three weeks ago - although operations at Hay Point are still significantly restricted.

Congestion at the two coal ports has fallen to approximately 88 vessels, says Jeffrey Landsberg of Commodore Research, which makes 16 less than the previous week and about 25 vessels more than at the beginning of February. Approximately 188 vessels are now anchored at all of Australia’s major ports, 30 less than a week ago.

However, despite the immediate queue reduction, the difficulties have been underlined for the supply chain, prompting fears buyers will look to other suppliers who can guarantee faster delivery.

The problem at major east coast coal ports such as Dalrymple Bay and Newcastle, exacerbated by recent cyclones and subsequent damage to port facilities, pushed the queues of bulkers waiting for berths to over 200 at times, increasing the costs for ship charterers whose average rate has peaked at over US$25,000 per day.

This section of costs have long been recognised in the coal supply chain. According to information contained in the accounts for Hunter Valley coal subsidiary Coal & Allied, its demurrage bill ran to A$35.8m (US$33.2m) in the financial year to June 30, 2009.

Japanese and South Korean buyers are understood to be looking at American coking supplies as one alternative source. The estimated loss of Australian coal exports could run to four to eight million tonnes as a result.

Source: Port Strategy