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Global metallurgical coal long-term outlook H2 2019: Future brings Indian order after China Chaos

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18 December 2019

Global metallurgical coal long-term outlook H2 2019: Future brings Indian order after China Chaos

Report summary

Reborn in 2016, the new metallurgical coal market has experienced its first major teething problem, with Chinese customs delays, restrictions and an Indian demand slump combining to send prices tumbling since mid-2019. The next two years are suddenly less predictable. The volatility of these early years will eventually make way for greater stability, and persistent growth as the metallurgical coal market matures. However, growing pains are inevitable, particularly as China transitions to a lower growth, less steel-intensive economy, in which metallurgical coal demand falls persistently. We still envisage the period between 2021 and 2024 being one of structural readjustment, with both Chinese and International prices falling, and support eventually being provided by mine production costs. Ultimately though, an elixir of rapid Indian demand growth, and a supply pipeline under severe pressure, will reinvigorate trade growth, and keep real prices on an upward trend into the long-term.

Table of contents

  • Reclassification of metallurgical coals
  • What has changed since last update?
  • What has stayed the same?
    • Have Chinese and seaborne prices diverged forever?
    • 2020-2024: Structural change is coming
    • 2025-2030: New projects required but supply options are available
    • 2030-2040: Demand consolidates as production capacity declines
  • What role does de-carbonisation play in our base case?
  • What has changed since last update?
  • What has remained the same since last update?
    • Australia
    • United States
    • Canada
    • Russia
    • Indonesia
    • Mozambique
  • Global Infrastructure Overview
  • What has changed since last update?
  • What has remained the same since last update?
  • Demand Forecast Overview
    • All Indian steel sectors set to grow
    • BF-BOF steel still the first steel-making option for India
    • Coal self-sufficiency impossible
    • Indonesia
    • Vietnam
  • Chinese hot metal in decline but high-quality imports required long-term
  • PCI demand outlook exciting, but fragile
  • SSCC to grow with India and coke technology the driving force

Tables and charts

This report includes 23 images and tables including:

  • India’s delivered average HCC/SCC costs in 2019
  • India’s delivered average PCI costs in 2019
  • Supply change 2019 to 2040
  • Demand change 2019 to 2040
  • Long-term Indian crude steel, hot metal, coke production and coal imports
  • Long-term Chinese crude steel, hot metal, coke production and coal imports
  • Global PCI demand
  • Global SSCC demand
  • Price support
  • 2020 - 2025 Chinese Coke Demand and Seaborne Coal Imports
  • Breakeven curve
  • Cash cost curve
  • Metallurgical coal supply by coal type (Mt)
  • HCC Project need YOY
  • Demand versus operating capacity (with disruption)
  • Incentive price curve

What's included

This report contains:

  • Document

    Global_metallurgical_coal_long-term_outlook_H2_2019_slidepack.pdf

    PDF 2.23 MB

  • Document

    CMS_data_metallurgical_trade_long_term_outlook_2019_H2.xlsx

    XLSX 19.05 MB

  • Document

    CMS_data_pivot_view-metallurgical_trade_long_term_outlook_2019_H2.xlsx

    XLSX 2.53 MB

  • Document

    CMS_price_charts_metallurgical_trade_long_term_outlook_2019_H2.xls

    XLS 2.17 MB

  • Document

    Global metallurgical coal long-term outlook H2 2019: Future brings Indian order after China Chaos

    ZIP 15.88 MB

  • Document

    Global metallurgical coal long-term outlook H2 2019: Future brings Indian order after China Chaos

    ZIP 15.89 MB

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