Coal futures trading explodes in 2013 on international markets

CME Group, which runs a derivatives marketplace, announced Jan. 14 a record year for its international coal futures of 1,298,361 contracts (representing 1.3 billion metric tons) traded in 2013.

This is a 300% increase compared to the volume traded in 2012 which was 329,985 contracts (330 million tonnes).

Volumes have continued to grow in line with demand for coal as the fuel of choice in global energy markets, CME Group said. This international coal volume comes from non-U.S. CME Group coal products as follows: Coal (API2) CIF ARA (ARGUS-McCloskey) Futures; Coal (API4) FOB Richards Bay (ARGUS-McCloskey) Futures; Coal (API 5) fob Newcastle (Argus/McCloskey); Indonesian Coal (McCloskey sub-bituminous); and Coal (API 8) cfr South China (Argus/McCloskey) Futures.

The highest number of coal contracts traded on a single day in 2013 was 13,935 contracts on Sept. 3. The monthly record was in October with 171,988 contracts traded. Annual Open Interest for international coal at the end of December 2013 was 118,448 contracts compared to 47,215 contracts at the end of December 2012.

In June, CME Group launched the Coal (API 5) fob Newcastle (Argus/McCloskey) deliverable in Western Australia to add to the Asian Indonesian Coal (McCloskey sub-bituminous), and Coal (API 8) cfr South China (Argus/McCloskey) Futures contracts. A total of 17,595 contracts were traded in 2013 across these three Asian contracts as new players entered the market.

The total volume for U.S. coal futures for 2013 was 269,688 compared to 229,919 contracts in 2012.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.