Reuters reported that demand for steelmaking coal should increase next year and send prices higher than their current low levels.

Mr Brett Harvey chairman and CEO of US coal miner Consol Energy said that current low metallurgical coal prices driven down by weak demand in China and elsewhere, could result in some uncompetitive companies in the high-cost Appalachian coalfields falling by the wayside.

Mr Harvey said that "Demand for met (metallurgical coal) has dropped off, that's why Buchanan is shut down referring to Consol's mine in Virginia that the company has temporarily idled.”

He said that but we see a shift the marginal players must be shaken out. At current prices mines in the US are absolutely under water. I think in 2013 there will be a shakeout and we expect prices for high quality met coal to be back up at USD 215 to USD 230 per tonne compared to USD 168 now.

Source - Reuters

(www.coalguru.com)