IF you want to know what the end of a commodities boom looks like, you need only stand on the foreshore at Newcastle.

Just 18 months ago, more than 70 giant coal ships lay anchored, the queue stretching to the horizon and almost 100km south. Yesterday, there were 17.

In mid-2007, as Australia rode China's insatiable demand for our commodities, ships and their bored crews would wait almost a month at anchor for their chance to enter the port. Yesterday, the wait was down to eight days.

Newcastle Port, the world's biggest coal port by volume, partly attributes the shortened queue to infrastructure spending and efforts to remove bottlenecks that have plagued the facility and others like it.

But there is no doubt that falling Asian demand for thermal coal for power generation, and coking coal and iron ore for steel-making, means fewer ships making the trip north.

The story is the same at Dalrymple Bay, about 1500km north on Queensland's central coast. Five ships were waiting to enter the nation's biggest coking coal port yesterday, down from a peak of 55 in 2007.

At the iron ore centre of Port Hedland in Western Australia, 11 ships were waiting offshore yesterday, after a high of 17 last year.

The statistics signal an ugly start to the annual round of negotiations on the price customers in China, Japan and Korea will pay for our coal and iron ore.

Investment banks such as Goldman Sachs JBWere and Merrill Lynch forecast that coking coal will fall from $US300 a tonne to $US120 a tonne this year. Thermal coal has fallen from about $US120 a tonne to $US85.

ABARE, the federal Government's chief commodities forecaster, in December downgraded its forecast earnings from Australia's commodity exports to $192billion in 2008-09, from an earlier forecast of $214 billion. ABARE is updating these forecasts amid the global downturn.

The losers will be workers, as resource companies shut marginal mines, and the state governments that milk royalties from the sector.

Dalrymple Bay general manager of port operations Greg Smith said yesterday a drop in the number of ships became obvious in the middle of November. "We started to see the impact of the global financial crisis in the middle of November, and the slowdown in the number of ships is definitely due to a slowing down in demand, and some games going on with price negotiations," he said.

Mr Smith said that with steel mills globally cutting production by 15 per cent to 30 per cent, there was less demand for coking coal.

Xstrata Coal spokesman James Rickards said enormous efforts had gone into improving port structures in the past couple of years, but the global economic downturn was having a significant impact on consumer demand.