BHP Billiton’s coking coal price for shipments to Japan has been slashed by nearly 25 per cent to $US170.
The price will affect shipments of coal from Queensland to Japanese steelmakers in the December quarter as demand in the region continues to fall, Business Today reports.
Hard coking coal, which is a top-grade product coming out of Queensland could fall to as little as $US140 a tonne.
According to the Tex Report from Tokyo, weak demand in China along with shipments from Mozambique has seen coking coal prices under extreme pressure.
The fall in cost of coking coal comes on the back of a Queensland Government decision to hike coal royalties, a move which has been labelled as the “final straw” for the industry.
Speaking at a Fairfax Media lunch yesterday, BHP Billiton chairman Jac Nasser said the decision will result in more job losses and uncertainty for the coal industry in Australia, which is already suffering.
“I would suspect that many coal mines in Queensland today will be cash-flow negative,” he said.
Nasser went on the say that declining coal prices coupled with a strong currency and high labour costs were the major issues facing the industry and instead of ‘fiddling’ with legislation the government needed to create more confidence for the mining industry.
It comes as another blow for the mining giant who earlier this week announced plans to close the Gregory mine in QLD due to high costs and low commodity prices.