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Europe at US$60/t: when do US thermal coals become competitive?


Europe at US$60/t: when do US thermal coals become competitive?

Report summary

With European thermal coal prices hovering at US$60/t, market participants are asking: when does the US come back into the export market? Since January, the delivered cost curve has moved upwards by US$4-5/t, and available capacity has contracted. This allows for the main US suppliers to be more-or-less "in the money", in theory. There should be an opportunity for an additional 3-5 Mt if prices are sustained at current levels. But the picture is muddied by available capacity, US domestic demand, shipments from global competitors, and size of the market in the Atlantic.

What's included?

This report includes 1 file(s)

  • Europe at US$60/t: when do US thermal coals become competitive? PDF - 286.53 KB 6 Pages, 0 Tables, 4 Figures

Description

This Coal Insight report highlights the key issues surrounding this topic, and draws out the implications for those involved.

Participants, suppliers and advisors can use it to look at the trends, risks and issues within the coal industry and gain an alternative point of view when making decisions.

Wood Mackenzie is the only coal industry service provider that offers a market outlook integrated with other sector analyses, including macroeconomics, coal supply, steel markets and gas and power markets.

Our coal analysts are based in the markets they analyse. They work with objective, proprietary data to help you maximise your current and future decision making. From market dynamics to trade patterns, we give you confidence in your strategic planning.

  • Executive summary
  • The delivered cost curve moves upwards
  • Supply capacity tightness: what does a realistic curve look like?
  • US exports and ability to ship

In this report there are 4 tables or charts, including:

  • Executive summary
  • The delivered cost curve moves upwards
    • European delivered cost curve evolution: January to August 2016
  • Supply capacity tightness: what does a realistic curve look like?
    • South African thermal exports: destinations and volumes (Mt)
    • Delivered cost curve: with capacity restrictions
  • US exports and ability to ship
    • US stockpiles – near record levels, and likely to be burned down quickly
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