Tons of Coal

The coal stocks ripped higher yesterday.  Perhaps speculators were betting a Vice-President candidate was going to announce “I love coal”, as did a candidate at the top of a ticket.  Natural gas was very strong on an inventory number suggesting the baseline has shifted.

Coal Stocks Gaining Momentum at AC Investor.  Coal Stocks Could Explode Higher by Jonathan Verenger.

Also driving yesterday’s rally:  “Shares of coal mining companies surged Thursday and Dahlman Rose & Co. predicted that demand may be on the rise from steel manufacturers in China.”  Yahoo

Conversely, Rio Tinto ‘more cautious’ on short-term outlook at Mining Weekly.  As for China, this is a week old and still not near being resolved:  “Note the massive, five-year symmetrical triangle on the FXI chart below, that appears to be coming to a head.”  Chess

Coal prices were higher last week (EIA).  Be aware, however, the industry generally sells coal forward directly to utilities and the spot prices shown are unprofitable.  But the trend…

Quarterly Coal Report from the EIA.

The export of U.S. Rocky Mountain PBR coal (CLD, BTU, ACI) continues to be discussed:  Columbian.

The 2 Big Electric Generation Winners: Gas Up 47% & Non-hydro Renewable Energy Up 76% Since 2008 by John Hanger.

“Proponents say wind and solar subsidies are needed for a few more years to allow these clean, renewable sources of energy to develop to the point where they can compete on price with electricity produced from coal and natural gas. But opponents of the subsidies say that they simply cost too much, and that the supposed benefits of wind and solar power are overstated.”  WSJ

“Stunning Fact: Gas Prices Will Determine Whether 21,000 Megawatts Or 141,000 Megawatts Of Coal Retires, According To Blockbuster New Study” by John HangerEconomic pressure on coal-fired plants gives opponents more fuel at SNL.

U.S. Natural Gas Storage ChartsBMO.

Question:  Hey J.J., why UPL over SWN and RCC?  Answer:  Valuation

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