Glencore, Japan's Tohoku set annual coal price down 17 pct -sources

* Glencore (Xetra: A1JAGV - news) , Tohoku set thermal coal price at $67.80/T -sources

* Same price as agreed by Rio Tinto (Xetra: 855018 - news) , Tohoku previously (Adds detail)

By Osamu Tsukimori

TOKYO, April 7 (Reuters) - Mining group Glencore Xstrata Plc and Japan's Tohoku Electric Power Co have settled an annual Australian thermal-coal import contract 17 percent lower than a year earlier, sources with direct knowledge of the matter said on Tuesday.

The price for the fiscal year beginning April 1 was set at 67.80 per tonne, the same as an agreement last week between Tohoku and Rio Tinto , the three sources said, underscoring a mounting supply glut for thermal coal worldwide.

Australia is by far the biggest supplier to Japan, accounting for 80.4 million tonnes last year, or nearly three quarters of its thermal coal imports.

The price set by Tohoku and the two suppliers will likely be followed by other Japanese utilities.

Annual contracts starting in April account for the majority of Australian thermal coal imports to Japan, covering around 50 million tonnes.

International coal markets have been hit as China, the world's biggest producer and importer of the fuel, has curbed imports to support its own mines and as it battles pollution at home.

A Tohoku spokesman said it had agreed with multiple resource majors on Australian coal supplies for the new fiscal year but declined to give details.

Glencore did not immediately respond to requests for comment.

Other would-be buyers said they were disappointed with the price, as spot has recently plunged to below $60 a tonne.

Asian benchmark thermal coal from Australia's Newcastle terminal has fallen around 10 percent this year, last settling at $56.85 a tonne. The price has lost more than 60 percent since early 2011.

"The agreed price came a bit too high, but I guess Tohoku was obliged to accept it in order to secure a stable source of high-quality coal," one buyer said.

(Additional reporting by Jim Regan in Sydney; Editing by Aaron Sheldrick, Edmund Klamann and Joseph Radford)