EURO COAL-Prices rise on the back of firmer power market

Thu, 16 Jan - 3:50am

* Ongoing Colombian export outage supports ARA prices

* South African prices up on tight power supply

LONDON, Jan 15 (Reuters) - European physical coal prices rose on Wednesday due mainly to an increase in German power prices, while South African prices were up on the back of tight electricity supplies there.

Coal prices for delivery in April into Europe's main import terminals of Amsterdam, Rotterdam and Antwerp (ARA) traded at $83.50 a tonne, up 30 cents from Tuesday's close.

Traders said that the rise was mainly due to rising German power prices.

"German utilities are burning a lot of coal at the moment so when power prices pick up, then ARA coal prices usually follow," one trader said, adding that export problems in Colombia also boosted the coal market.

German power prices for delivery next year were up 20 euro cents to 36.20 euros ($49.55) per megawatt-hour on Wednesday, driven up by higher costs for carbon certificates that utilities have to buy for every tonne of CO2 they emit through their power stations.

On the supply side, U.S. coal miner Drummond Href="NewsSearch">DRMND.UL has halted loading at its Colombian port at the start of a shutdown that could persist until March and may slash the country's exports by as much as 10 percent. News Search ID:nL6N0KO2AE

The government ordered Drummond last week to stop loading coal onto ships at its port because it was unable to comply with a new law that requires it to use an enclosed conveyor belt. Drummond said it has not yet finished building the system, and expects to have it in place by the end of March.

Colombia supplies around 20 percent of Europe's hard coal imports and Drummond is the country's No. 2 coal producer.

In South Africa, coal prices also rose as the country's power supplies remained tight, triggering black-out fears that could result in coal export disruptions.

Coal cargoes from South Africa's Richards Bay terminals for delivery in February were up $1.15 a tonne to $86.50 per tonne.

($1 = 0.7306 euros)

(Reporting by Henning Gloystein; Editing by Susan Fenton)

((henning.gloystein@thomsonreuters.com)(+44 207 542 6659)(Reuters Messaging: henning.gloystein.reuters.com@reuters.net))

Keywords: MARKETS COAL/PHYSICAL

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Topics: 
ELG EZC ZA ELEU TRNSPT CMPNY ENV INDS WEA COAPWR UTIL ENR REP DRV PORT RTRS MIN BE DE TRAN COA EUROPE ENER US TMP PWR AU EUROP COM DBULK MKTREP COAM ASIA EMRG LEN GEN NL SHIP AFR WEU AFE CO LATAM NRG AMERS CEEU

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