Aug. 18 (Bloomberg) -- Benchmark prices for coking coal, which is used by steelmakers, may rise about 60 percent next year as supply lags demand, industry consultant McCloskey Group said. Contract prices between producers of premium hard coking coal in Australia and Japanese steelmakers may rise to $95 a metric ton in the Japanese financial year beginning April 1 from $59 a ton this year, U.K.-based McCloskey said in an e-mailed report.

``There has been no period like this one in living memory for the normally tranquil hard coking coal market,'' McCloskey said in its quarterly report. ``Events in China have and will continue to dominate the direction of the price for the next two to three years.''

World steel output rose 6.7 percent last year and 7.9 percent in the first half of this year, according to the International Iron and Steel Institute. China, the world's largest steelmaker, cut its coking coal exports by 4 percent in the first half and increased its imports by 2 percent.

To contact the reporter on this story: Stuart Wallace in London swallace6@bloomberg.net.

Last Updated: August 18, 2004 11:04 EDT