Index of Commodity Prices April 2010

Preliminary estimates for April indicate that the index increased by 17.6 per cent (on a monthly average basis) in SDR terms, after rising 2.8 per cent in March (revised). The largest contributors to the rise in April were increases in the estimated prices of iron ore and coal in SDR terms. In Australian dollar terms, the index is estimated to have risen by 15.1 per cent in April, following a fall of 0.8 per cent in March (revised).

The increases in the estimated prices for iron ore and coal in April reflect partial adjustment to substantially higher contract and spot prices. For example, coking coal contract prices have increased by 55–100 per cent in the June quarter relative to 2009/10 contract prices, while June quarter iron ore fines prices are estimated to have settled around 100 per cent higher. Annual thermal coal contract prices have risen by 36–40 per cent.

The estimates for April are preliminary because actual export data provided by the Australian Bureau of Statistics are not yet available. In previous years, changes to bulk commodity contract prices have passed through to export prices and the index over a number of months, and this is also expected to occur this year. Some adjustment in iron ore and coal export prices had already taken place prior to April, in part reflecting spot‑market sales. Further rises are expected over the subsequent months. Because of the changing structure of the contract pricing system, the index will likely be subject to more revisions from April onwards than in the past.

For further details regarding the construction of the index, please refer to ‘Updating the RBA's Index of Commodity Prices’ in the October 2009 issue of the Bulletin.