Coal - where to now?

[noirua]

Vessels loading coal at the Newcastle port are experiencing increased demurrage. Vessels waiting have risen to 45 and 4 in port. Average waiting time is 14.03 days and comes as a disappointment after comments on improvements have been made.

 

[noirua]

Another week and thermal coal prices continue their uncertain path despite Xstrata tieing up an US$80 per tonne agreement for thermal coal out of Australia for 2009.

Thermal coal prices, spot, out of Newcastle for 3 months delivery, fell 44 cents to US$77.81 a tonne.
In Europe, down 11 cents to US$77.00 a tonne and the States, up $6.15 at US$80.33 - the latter somewhat bucking the trend.

Coal prices have improved a little to end the year. Thermal out of Newcastle on 26th Dec 08 rose $2.76 to US$80.56 per tonne.
Europe recovered from dumping, to be up $5.50 at US$82.50 a tonne.
The US rose 67c to US$81.00 a tonne.

 

[kransky]

can you please point me to where those prices are tracked or documented on the web? i'd like to track it myself too if possible

thanks

 

[michael_selway]

can you please point me to where those prices are tracked or documented on the web? i'd like to track it myself too if possible

thanks

http://www.globalcoal.com/

If you buys things at the bottom it could turnout good etc

thx

MS

 

[kransky]

thanks!

 

[noirua]

South Korea have announced they are to build 12 nuclear power plants, 11 natural gas and 7 coal-fired, by 2022.

 

[gfresh]

MCC, CEY, RIV, GCL all rose over 7% (some into double digits) on the last day of the trading year.. anything to be read into this for 09?

 

[michael_selway]

MCC, CEY, RIV, GCL all rose over 7% (some into double digits) on the last day of the trading year.. anything to be read into this for 09?

Yeah time tobring outteh list again Btw any new coal stocks i missed below?

Coal (Thermal & Coking) Majors - CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, WES

Coal (Thermal & Coking) Minors: CDS, CAG, CES, EQX, EER, RCI, BWN, GNM, ATQ, TCM, FSE, CWK, REY, LOD, BTU, AAL, SRL, MLM, CCD

Coal Seam Gas (CTL & UCG) - GLX, BLK, LNC, AOE, SXP, MEE, CXY, PES, ESG, MPO, BUL, QGC, SHG, MEL, ENB, ORG, PGS, MAE, GEL

thx

MS

 

[noirua]

Interesting this coal sector in 2009 that may lead to a few successes at one end and a few failures at the other.

The Aussie$ is a key factor here. If it stays well down then new currency agreements from April 2009 will see thermal producers do quite well.
Worth checking, sometimes difficult, just how much it costs to produce the coal per tonne.

If the mine produces coking coal only and is a high cost underground mine, with heavy rail and shipping costs, then the decline will be quite marked.

Some may be developing mines that are costing AU$100 to AU$400 million, whilst profits drop from their producing mines.

Do your own research they say, in this sector it is critical.

 

[noirua]

Coal prices have improved a little to end the year. Thermal out of Newcastle on 26th Dec 08 rose $2.76 to US$80.56 per tonne.
Europe recovered from dumping, to be up $5.50 at US$82.50 a tonne.
The US rose 67c to US$81.00 a tonne.

Thermal coal out of Newcastle for 2nd Jan 09, spot, 3 months delivery, fell $1.37 to US$79.19 per tonne. US fell 6c to US$80.94 a tonne and Europe rose $1.16 to US$84.16 a tonne.

 

[pacestick]

This seems to be an unusual slowdown in the world economy back in the recession we had to have Wrans navy i.e. the ships anchored off newcastle disappeared . I live in Newcastle and i can see a lot anchored along the coast line waiting to get into port to load .Newcastle Port reports that in the week to 29 December they loaded 25 ships and the waiting time was an average of 13.5 days As of the 29 December there were 45 vessels waiting to load a total of 3,835,996 tonnes of coal

 

[Rockon2]

Yeah time tobring outteh list again Btw any new coal stocks i missed below?

Coal (Thermal & Coking) Majors - CEY, FLX, GCL, MCC, NHC, WHC, AQA, RIV, COK, CZA, PRC, CNA, AVA, NEC, WES

Coal (Thermal & Coking) Minors: CDS, CAG, CES, EQX, EER, RCI, BWN, GNM, ATQ, TCM, FSE, CWK, REY, LOD, BTU, AAL, SRL, MLM, CCD

Coal Seam Gas (CTL & UCG) - GLX, BLK, LNC, AOE, SXP, MEE, CXY, PES, ESG, MPO, BUL, QGC, SHG, MEL, ENB, ORG, PGS, MAE, GEL

thx

MS

Many thanks for posting up these,, I will update my watchlist..

Cheers

 

[michael_selway]

Many thanks for posting up these,, I will update my watchlist..

Cheers

NP i think there maybe a few new ipos since i last postedthat list as now looking to get back into the coal sector afterbeing out for a while ;p

http://www.theaustralian.news.com.au/business/story/0,28124,24820923-643,00.html

Xstrata latest contract locks in coal price plunge

Matt Chambers | December 19, 2008
Article from: The Australian

THE nation's thermal coal exporters could face a 50 per cent drop in contract prices next year.

This would represent a $9 billion hit to exports, after Swiss mining giant Xstrata rushed to accept a big contract price drop.

Xstrata, the world's biggest thermal coal exporter, is understood to have locked in $US80 ($114) a tonne contracts with Japanese power companies for the next calendar year -- just half the price it received only three months ago.

The early agreement comes after Xstrata and Macarthur Coal this week started a round of production cutbacks and worker layoffs in Queensland's previously insulated coking coal industry.

With oil prices continuing to look shaky, analysts said Xstrata's thermal coal deal did not bode well for other local producers, such as Rio Tinto and Centennial Coal, who will be looking to negotiate contracts for the Japanese financial year, which starts in April.

It also makes analyst consensus of $US90 a tonne for the full year look too high, though many have been lowering forecasts in recent weeks.

"Time is against the suppliers in this market -- it is not surprising we are seeing them want to lock in prices quickly," said Mark Pervan, director of commodities research at ANZ in Melbourne.

Thermal coal contracts were settled at a record $US125 a tonne for this Japanese financial year, and Xstrata in September locked in a 12-month contract at $US155.

Unlike iron ore and coking coal, which are both used in steelmaking, thermal coal is not strictly contracted on a Japanese financial year basis and contracts can start at different times.

Prices of thermal coal, used to make electricity, had surged on the back of soaring global energy prices and are now expected to slide as oil prices plunge.

Customers are still expected to take delivery, and there has been no talk of production cuts. Government forecaster ABARE is predicting coking coal exports of $18 billion this financial year.

The worsening outlook for coking coal exports was reinforced last night by South Korea's POSCO, the world's fourth largest steelmaker, which announced its first-ever production cut to reduce rising inventory caused by a sharp fall in local demand. POSCO, which produces 2.78 million tonnes of crude steel a month, said it would reduce output by 200,000 tonnes this month 370,000 tonnes next month.

Merrill Lynch, which forecasts a contract price of $US80 a tonne next year, said the Xstrata deal would probably be seen as a benchmark, though the outlook for coal was not strong.

"This is a good deal for Xstrata as the thermal market is exposed to several key bear factors, including a ... weak short to medium term global economic outlook, rising coal production in China and weakness in metallurgical (coking) coal markets," Merrill analyst Vicky Binns said.

The sudden dip in global coking coal markets, with steelmakers this month suddenly calling for deliveries to be deferred, is expected to flow through to thermal coal.

Many coking coal mines have areas of thermal coal available if customers do not want the higher-quality hard coking coal.

Semi-soft coking coal can also be sold as thermal coal. Felix Resources managing director Brian Flannery said his company could start mining thermal coal instead of coking coal if steel mills could not take contracted volumes. He said there were no plans to do so, and there had been no requests for deferrals, but company representatives were in talks with Japanese steel mills about future needs.

ANZ's Mr Pervan forecasts contract prices of $US75 a tonne for the Japanese fiscal year. However, the slide in oil prices could drive this lower, he said.

Goldman Sachs JBWere this week dropped its forecast from $US90 a tonne to $US70.

thx

MS

 

[pacestick]

an. 5 (Bloomberg) -- Power-station coal prices at Australia's Newcastle port, a benchmark for Asia, slipped 1.7 percent last week as the number of ships waiting to load the fuel fell after higher-than-expected shipments in December.

The weekly index for power-station coal prices at the New South Wales port dropped $1.37 to $79.19 a metric ton in the period ended Jan. 2, according to the globalCOAL NEWC Index. The measure has risen from $76.09 a ton on Dec. 5, the lowest in almost 14 months.

Prices have fallen about 60 percent from the $194.79 a ton record reached in the week ended July 4 last year because of declining demand and lower crude-oil prices. Bottlenecks at Australian ports contributed to record prices last year as supplies were constrained to customers in Asia.

The number of ships waiting to load at Newcastle should fall to 19 by mid-January, from 30 at the end of December, the Hunter Valley Coal Chain Logistics Team, which coordinates coal movements to and from Newcastle, said on its Web site. The queue has fallen from 45 earlier in December, which was the most in a year.

The performance rates in December for the assembly of cargoes at Newcastle and their loading onto ships were both above target, the group said.

Xstrata, BHP

Xstrata Plc, the world's largest exporter of power-station coal, BHP Billiton Ltd. and Rio Tinto Group are among mining companies that ship coal through Newcastle. Zug, Switzerland- based Xstrata has been forced to accept a cut in prices for annual calendar-year contracts for the fuel with Japanese utilities, Citigroup Inc. and Merrill Lynch & Co. said Dec. 17.

Twenty-five coal ships left Newcastle in the week ended Jan. 3, one less than a week earlier, Newcastle Port Corp. said today in an e-mailed report. Sixteen of the vessels were headed for Japan, two each for South Korea and Taiwan, and one each for Mexico, China, Malaysia, France and Western Australia's Fremantle.

The monthly Newcastle thermal coal price index fell 14 percent to $78.18 ton in December, from $91.36 the previous month, according to globalCOAL. It was the lowest since October 2007. The January Newcastle coal futures contract closed Jan. 2 at $74.35 a ton, down 1.7 percent, on London's ICE Futures Europe exchange.

The volume of coal transported to Newcastle for export rose 8 percent last year to 91.4 million tons, while the volume loaded onto ships advanced 7.5 percent to 92 million tons, the Hunter Valley Coal Chain Logistics Team said in its end- December report.

 

[J.B.Nimble]

Slightly old news (must have been preoccupied on New Years eve...)

(INTERFAX-CHINA)
Updated: 2009-01-04 09:05
Counter:123

Chinese coke producers are earning profits again now that demand has rebounded amid relatively low coking coal prices, a coal analyst told Interfax on Dec. 31.


Ma Xiaoguang, a coal analyst with metal information portal Umetal, estimated that coke producers are earning profits of between RMB 50($7.31) and RMB 100 ($14.62) per ton.


The market price of coking coal, the main raw material in coke production, is sitting at about RMB 1,200 ($175.44) per ton, which is around the same price level of coking coal at the beginning of this year, Ma said.

Coking coal prices peaked at the end of July at RMB 2,200($321.64) per ton. Annual contract prices for coking coal are about the same as current market prices, though contract prices are usually adjusted every quarter.


Meanwhile, coking coal companies are offering discounts of RMB 200($29.24) per ton to some steel mills in southern China that purchase coking coal directly, Ma said.


Coke producers have also benefited from an upsurge in downstream demand as a number of small-sized steel mills resumed production at the beginning of December in response to growing demand for steel.


The situation suggests that coke demand grew in December, which in turn caused coking coal prices to rebound recently, Ma said.


Coke prices in Shanxi Province, China's largest coke producing region, rose to between RMB 1,500 ($219.30) and RMB 1,600 ($233.92) per ton as of Dec. 30, up from RMB 1,100 ($160.82) to RMB 1,300 ($190.06) per ton on Dec. 1, according to Umetal.

I like the suggestion that coking coal prices have started to rebound. The world hasn't stopped after all...

 

[noirua]

I like the suggestion that coking coal prices have started to rebound. The world hasn't stopped after all...

Part of the struggle, will be whether certain types of coal can or cannot replace others. Semi-soft coke and PCI coal can replace thermal coal and some suppliers may take the opportunity to unload it at thermal prices.

 

[noirua]

Most coal stocks have rebounded, rising up to 100% from their low point. Most are still at a third or less of their 2008 highs.
Profit forecasts for year ending 2009 are set to tumble and again for 2010.
It will be during 2009 that they come out of the melting pot, mostly after June 30th year end trading finishes.

 

[roland]

Most coal stocks have rebounded, rising up to 100% from their low point. Most are still at a third or less of their 2008 highs.
Profit forecasts for year ending 2009 are set to tumble and again for 2010.
It will be during 2009 that they come out of the melting pot, mostly after June 30th year end trading finishes.

Gee I wish that the rebound were true of MCC. Still stuck around the $3.00 mark. There is probably enough intra-day to trade, but I'm still shell shocked with MCC - bottom draw right now. mmmm, my bottom draw is not a pretty site

 

[noirua]

Gee I wish that the rebound were true of MCC. Still stuck around the $3.00 mark. There is probably enough intra-day to trade, but I'm still shell shocked with MCC - bottom draw right now. mmmm, my bottom draw is not a pretty site

After that major backtrack on profits and dividends at Macarthur, confidence in the board of directors is seriously in doubt. Wouldn't be surprised to see the major holders put the pressure on now, some need tipping.

 

[noirua]

Most Aussie coal companies will give a quarterly report for their second quarter in the next 3 weeks and a half yearly report during February.

The quarterly report will give some clues as to how steep coal sales dropped off.

The other factor will show the extent of companies switching to thermal coal, if they can, and the extent of delays for PCI coal, semi-soft coke and semi-hard to hard coke.

The affect is expected to be dramatic on PCI and coke. But far less so on thermal coal, especially thermal sent in single ships, all from the same mine that is.