The world benchmark price for steelmaking coal slipped from its record high for the current quarter, but that likely won't hurt producers too deeply, according to Scotiabank's latest Commodity Price Index.

Prices, largely set by contract, fell to $315 per tonne from $330 in the previous quarter, largely because of the recovery of production at Australian mines that were flooded out by La Nina-related winter storms, said Scotiabank commodity expert Patricia Mohr in an interview Wednesday.

"But that $315 is still higher than any price other than the [previous] quarter," Mohr added.

"Three-hundred-and-fifteen dollars is very high."

And it was China's nearrecord-high steel production earlier this year that held coal prices up, Mohr said.

Japan saw some of its steel production interrupted by the March 21 earthquake and tsunami that devastated a large swath of northeastern Japan.

However, "China's demand would have more than offset" the reduction in Japan's production.

Coking coal is mixed with iron ore and burned in blast furnaces during the steel-smelting process.

However, the interruption of steel-production capacity in Japan is still weighing on B.C.'s Teck Resources Ltd., which cited the deferral of shipments by Japanese customers as the reason for a reduction in its estimate for output in the second quarter of 2011.

In its most recent guidance for coal production, Teck said it expects its shipments for the second quarter to come in at the low end of its estimate of 5½ to six million tonnes.

And the company estimated that its average price on coal sales would come in at $270 per tonne, down from its previous estimate of $280 to $290 per tonne, largely because of a change in the mix of coal types due to the deferred shipments to Japan.

Teck, which reports its second-quarter results today, saw its shares drop $2.38 to close at $47.29 in Wednesday trading on the Toronto Stock Exchange.

In the long run, however, Mohr expects Chinese demand to keep metallurgical coal at relatively high prices.

She noted that new coal shipments from Mongolia made that country China's biggest supplier in the first half of 2011, but that was largely because of the steep decline in shipments from Queensland in Australia, which have not fully recovered.

For the balance of 2011, Mohr expects the top price for metallurgical coal to average $298, which is still lucrative and offers support to the expansion ambitions of Canadian companies, such as Teck's proposed reopening of its Quintette mine in northeastern British Columbia.

"It all depends on China and its economic growth continuing to move ahead at a reasonable pace," Mohr said.