Australia coal ports shut as cyclone intensifies

SYDNEY (REUTERS) - Industrial ports have closed along Australia's Queensland coast as a cyclone strengthens offshore, bringing some of the world's largest coal shipping operations to a halt, port officials said on Thursday.

Tropical Cyclone Dylan has formed off the north Queensland coast and is expected to continue moving in a general southwesterly direction and to gradually intensify, before hitting land early on Friday, according to the Australian Bureau of Meteorology.

It was too early to determine how long ports will remain closed, but traders said a short interruption in shipping would have little impact on markets.

At around 0300 GMT (11am Singapore time), Dylan was classified as a category one cyclone, the lowest on a one-to-five scale.

The Hay Point terminal, used to ship coal mined jointly by BHP Billiton and Mitusbishi Corp, has been shuttered, along with the nearby Mackay port, a ports spokeswoman said.

In addition, the Abbot Point coal terminal used by Glencore Xstrata and the Dalrymple Bay terminals are shut.

The Port of Townsville, used by Queensland Nickel to import ore and export refined nickel has cancelled all ship movements, said the port's chief executive, Ranee Crosby.

Townsville residents are being warned of dangerous storm tides.

The sea is likely to rise steadily to a level well above the normal tide, with damaging waves and flooding of some low-lying areas close to the shoreline, according to emergency officials.

Dylan was about 235 kilometres north-east of Townsville at around 0300 GMT, moving at 14 kms per hour and packing winds of 120 kms per hour.

About 20 ships waiting to load coal exports at the Dalrymple Bay terminal moved further out to sea earlier this week because of rough seas, and the harbourmaster is not allowing ships to return, possibly until Friday, by which time the cyclone is forecast to drop in strength.

The Dalrymple Bay terminal moved more than 65 million tonnes of coal in 2013, industry data showed.

The Port of Abbot Point handled 21 million tonnes of coal, which is shipped from collieries in the Bowen Basin, the world's single-largest source of metallurgical coal.

Powerful cyclone Yasi led to the closure of coal terminals in Abbot Point, Hay Point and Dalrymple Bay for almost one week in February 2011, leading to a surge in coal prices after the supply chain was disrupted.

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