Coal and China

Is Coal Ready for Comeback?  Coal Investing

“…a super-bullish take on the state of coal markets, noting it should pass crude oil as the world’s largest energy source next year as everyone from the U.S. and China to Europe, Japan, and India continue to increase coal-fueled electricity generation and steel production.  The coal supercycle, it seems, is back.”  Forbes

BTU, ACI and CLD all rallied sharply on third quarter earnings announcements.  BTU and ACI are being sued over the Patriot bankruptcy (Platts).

The company’s tended to be cautious on Q4 and excited about 2013.  A different opinion:  Doyle Trading.

U.S. coal production in September did a swan-dive at the EIA  Electricity generation from coal and natural gas both increased with summer heat from the EIA.

NATGAS needs snow in Chicago (Greg Schnell).  Sounds like the Northeast might be getting some next week.

“India’s thermal and coking coal imports rose 18 percent to 63.98 million tonnes in April to September from a year ago, coal ministry figures provided by an official showed, as local supplies continued to lag galloping demand.”  Reuters

Steel-making coal:  US coal industry pins hopes on China’s stimulus at China DailyISA is still waiting on the Industrialization of China meme, and TCK’s coking coal pricing is exhibit A.

China and the U.S. are interdependent (Sober Look).  The global impact of China’s slowdown:  FT.

Is China due for a Slowdown?  FRBSF Economic Letter  China’s flash PMIISA maintains the investor wishing to invest in the industrialization of China theme ought to sell them what they need, though Chinese Stocks Look like a Bargain by Frank Holmes.

From Ritholtz:

 

4 thoughts on “Coal and China

  1. A friend asked me:
    “How did ACI & CLD achieve such good numbers? Need your insights.”

    My response:
    “”The increase in shipments was due to increased demand as customers caught up on their committed deliveries after a strong summer burn.”

    PBR coal will recover first as the low cost coal. Further, the low snowpack from last winter has hydro power generation low. CLD is exclusively PBR coal and ACI is heavy into PBR. Both lowered capex expectations. ACI made clear they anticipate Q4 to be soft but are more excited about 2013.

    ACI benifited from a settlement which I don’t have my arms around yet.

    CLD pukes free cash flow.

    ~JJ”

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