Coal As A Traded Commodity
In North America, Central Appalachian coal futures contracts are currently traded on the New York Mercantile Exchange (trading symbol QL). The trading unit is 1,550 short tons (1,410 t) per contract, and is quoted in U.S. dollars and cents per ton. Since coal is the principal fuel for generating electricity in the United States, coal futures contracts provide coal producers and the electric power industry an important tool for hedging and risk management.
In addition to the NYMEX contract, the IntercontinentalExchange (ICE) has European (Rotterdam) and South African (Richards Bay) coal futures available for trading. The trading unit for these contracts is 5,000 tonnes (5,500 short tons), and are also quoted in U.S. dollars and cents per ton.
The price of coal increased from around $30.00 per short ton in 2000 to around $150.00 per short ton as of September 2008. As of October 2008, the price per short ton had declined to $111.50. Prices further declined to $71.25 as of October 2010.
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