In just the past month Queensland metallurgical coal has risen 25 per cent to $US482 a tonne, a phenomenal price that would likely be offset by wet weather in central Queensland which will limit the ability of miners to produce it.

Thermal coal is up 20 per cent while gold, nickel and copper have all had their rises and falls and are currently down for the month. Iron ore has taken a hiding and is down 37 per cent since June, according to Westpac.

The issue is significant for Queensland because coal is its biggest export and a significant contributor to state finances though royalties.

The market is betting against China recovering enough and its growth forecasts of 5.5 per cent for 2022. The nation is still grappling with Covid and some of its cities remain in punishing lockdowns as it attempts to maintain a policy of zero Covid.

Queensland coal prices are high because of the Russia-Ukraine war. Russia was the third largest exporter of thermal coal and sanctions against it have caused the price to rocket.

“Our forecasts do have a correction from here with thermal coal down to $US250 a tonne (from $US337) at the end of 2022 and met coal down to $US355,” Westpac’s Justin Smirk said.

“At the end of 2023 thermal coal is forecast to have eased to $US149 a tonne while met coal is forecast to be down to $US250.

“The recent surge in prices has resulted from a shortage of seaborne coal. Supply is down 6 per cent year-to-date despite record high prices, with the industry struggling to lift output due to weather and Covid disruptions adding to the ongoing labour shortages and years of underinvestment.”

Smirk said thermal coal prices could remain elevated because of the high cost of gas which is currently about 45 per cent more expensive than coal in energy production terms.

Iron ore rallied on overseas markets overnight with a rise of 3 per cent to $US134 a tonne. Base metals were mostly higher and oil jumped 6 per cent.