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Coal - where to now?

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noirua said:
Thermal coal spot prices continued to sink out of Newcastle Port. Price fell on Monday to US$73.38 a tonne down from US$78.64 a tonne on the 17/2/09.

1/4/2008 - Price fix for benchmark thermal was US$125 per tonne (AU$134 per tonne).
Spot 23/2/2009 was US$73.38 (AU$106 per tonne).
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Quite a fall for Newcastle thermal coal to US$62.38 a tonne (AU$99 per tonne, as of posting) on 2nd March. Discussions are now taking place for prices on 1st April and forecasts for a price between US$70 - US$75 now look overly optimistic.
 
noirua said:
Quite a fall for Newcastle thermal coal to US$62.38 a tonne (AU$99 per tonne, as of posting) on 2nd March. Discussions are now taking place for prices on 1st April and forecasts for a price between US$70 - US$75 now look overly optimistic.
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With thermal coal prices moving to US$61.70 per tonne (AU$96.60 per tonne) the ongoing talks with Japan could prove very difficult indeed. Coal prices in America and Europe are between US$56 to US$58 per tonne.

This factor may well put the Aussie under further pressure.
 
Remember the good ol' days - April/May 2008 when you could put your money on an explorer and make a quid.

Ahhh memories!
 

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yup .. $couple of thousand in a few minutes :( I miss those days, they were easy, even I was making good money ! I doubt we will see that for another 10 years. Back on topic though...

Looks like the benchmark price for thermal coal is due to be settled around $US70-$72/tonne this year. This will have a massive effect on the QLD, and also to some extent the NSW State Budgets over the next 12 months.

http://www.businessspectator.com.au...44-pct-annual-price-cut-tr-PZDA7?OpenDocument

Xstrata, Rio agree to 44% coal price cut with Japan's Chubu

By Fayen Wong and Osamu Tsukimori of Reuters

PERTH/TOKYO - Xstrata and Rio Tinto Ltd have sealed thermal coal contracts with Japan's Chubu Electric for fiscal year 2009/10 at prices as much as 44 per cent lower than a year earlier, coal traders familiar with the negotiations said.

The first major price deal between big Australian coal miners and the Japanese utility, their main customers, normally sets the tone for further negotiations for contracts that cover the April to March Japanese fiscal year, affecting power plant costs and miners' revenues for the year.
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Newcastle Port waiting times for coal cargo is now down to 4.45 days and there are 15 ships waiting.
 
Thermal coal prices have continued to weaken at the Newcastle Port for spot prices. Tuesday price closed at US$60.59 a tonne, slipping 91c from Monday. Spot price is now 52% ( 31% in Aussie$ terms) down on the 1/4/2008 fix.
 
BHP are said to have agreed hard coking coal prices between US$115 - US$125 per tonne from 1st April '09 (down from US$300 per tonne last year).

POSCO have announced an agreement to buy PCI coal at US$90 per tonne from 1st April '09, down 63% on last year.
 
The coal sector may well get a lift from the G20 agreement as weaker economies should be inline for bailouts.
 
noirua said:
The coal sector may well get a lift from the G20 agreement as weaker economies should be inline for bailouts.
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Hi Noirua, which coal companies do you like at current prices? :)

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thx

MS
 
michael_selway said:
Hi Noirua, which coal companies do you like at current prices? :)

MS
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Hi m_s, "present prices", that's the problem after the recent run up. In fact, I can't find any "producer" that does not look reasonable at the present time, in the coal sector. Cheers noi
 
noirua said:
Hi m_s, "present prices", that's the problem after the recent run up. In fact, I can't find any "producer" that does not look reasonable at the present time, in the coal sector. Cheers noi
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Gloucester Coal are in a bid situation and Macarthur Coal have run up on stake building. Centennial and Whitehaven Coal look interesting. Felix Resources have come up on confident rhetoric from the companies MD on profitability at the Moolarben Mine, that is on track to produce in the spring of 2009.
Pike River Coal are undertaking a rights issue to raise $41 million. If successful, they are also interesting on present hard coke deals by BHP.
High risk is the name of the game in the exploration sector and only risk capital should be used.
 
More low key cheery news in the coal sector as prices for PCI coal are agreed at around the US$90 per tonne level.
Thermal coal continues its worldwide pickup in the last 5 days to finish at US$64.15 per tonne out of Newcastle, up $3.36 on the day.
 
Coal prices are still being affected by dumping of coal on to the spot market.
Thermal coal prices have been set for some supplies at US$70 - US$72 per tonne and PCI coal at US$90 per tonne. Unfortunately, many supply contracts for PCI coal have been cancelled, RIO's Hismelt, W.A. smelter being one, for example. This has left companies with a lot of PCI coal finding its way on to the QLD spot market as thermal coal.

In these markets it will be the low cost open-cut mines that prosper and some longwall mines.
The Aussie has strengthened from around AU$1.55 to the greenback to around AU$1.32. Any further strengthening may cause some mines to be mothballed.
 
noirua said:
Gloucester Coal are in a bid situation and Macarthur Coal have run up on stake building. Centennial and Whitehaven Coal look interesting. Felix Resources have come up on confident rhetoric from the companies MD on profitability at the Moolarben Mine, that is on track to produce in the spring of 2009.
Pike River Coal are undertaking a rights issue to raise $41 million. If successful, they are also interesting on present hard coke deals by BHP.
High risk is the name of the game in the exploration sector and only risk capital should be used.
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So far so good as ASF members, following coal, see big profits from the above. Thermal coal is pushing on hard, up 20%+ on spot markets, as confidence returns with a big rush. China is buying PCI coal on the spot markets that is helping QLD miners out of a hole.
Take care now!
 
Thermal coal is pushing on hard, up 20%+ on spot markets, as confidence returns with a big rush.
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Hi Noirua,

Is there a link or website where you can see daily spot prices for free. I know Reuters have some info but I couldn't find daily prices.
 
A surprising turnabout for the coal sector with thermal coal at US$73.82 a tonne and the whole sector amazingly bullish. The rebound appears a bit overdone and there could be profit taking as coal prices are still well down on the US$125 per tonne set last year and the high point of US$194 per tonne. Yes, the Aussie is also down at around AU$1.24 to the green back compared to AU$1.04: But this is not low compared to the AU$1.55 quite recently.
 
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