International Thermal Coal

They may be in bankruptcy protection, but Patriot Coal reports hefty Q2 loss on asset retirement charges, slumping revenues at SNL.

“Cox added that international coal prices had fallen significantly since the highs of 2011 when they averaged GBP3.01/GJ for the year compared with GBP2.40/GJ for the first six months of 2012, having dropped as low as GBP2.13/GJ in May.”  Platts

Indonesian thermal coal prices are quite depressed (Platts); remember they are a coal export leader as is Australia (Platts).  India prices (Platts), where there are chronic electricity generation shortages.  European coal pricing (Platts) has been stronger because of the Colombian rail strike (Mining).  South African thermal coal has rebounded from depressed levels (Platts), also benefiting modestly from the Colombian rail strike.  This morning the railway workers voted to end the strike (Mining Weekly).  Strike posturing is still occurring but the supply is coming back.  US Appalachian coal producer export efforts will be hampered.

Coal India Profit Exceeds Analyst Estimates as Production Climbs at Business Week.  Being state run Coal India has weird dynamics, yet as the largest coal producer in the world they need to be observed.

“The Mexican government halted operations at 32 small coal mines…”  Mining

Wilbur Ross wasn’t the only big player to sell coal holdings last year.  Iron Ore Heiress Cashes in on Coal, Dodging 30% Decline at Business Week.

Why is this international coal information important?  Every US domestic producer is chasing exports.

Dennis Gartman may recommend it, but the coal ETF KOL is not representative of US producers.  Peter Epstein

Later today Independent Stock Analysis will look at met coal and Chinese stimulus efforts.  ISA continues to like the idea of playing a rebound in US thermal markets. However, as the weather moderates expect coal fired plants to slow down.  I am comfortable enough waiting to take a few days off, starting Thursday.