After years of pain, coal becomes one of 2016's hottest commodities

Singapore

LESS than a year after the coal industry was declared to be in terminal decline, the fossil fuel has staged its steepest price rally in over half a decade, making it one of the hottest major commodities.

Cargo prices for Australian thermal coal from its Newcastle terminal, seen as the Asian benchmark, have soared over 35 per cent since mid-June to more than one-year highs of almost US$70 a tonne, pushed by surprise increases in Chinese imports.

"Chinese regulators have assumed the role that markets traditionally play in bringing oversupplied commodities back to balance," Goldman Sachs said in a note to clients late on Tuesday, reversing a gloomy outlook note it issued last September. "Restrictions on domestic production introduced earlier this year have lifted prices globally and turned coal into one of the be…