Commodity market report
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10 Pages

Global metallurgical coal short-term outlook August 2017: Supply concerns prolong the bull run


Global metallurgical coal short-term outlook August 2017: Supply concerns prolong the bull run

Report summary

Widespread mine safety checks in Shanxi have constrained production again in China, pushing domestic coal prices to new highs, with more likely to come. Chinese buyers have actively sought seaborne coal again this month, with hot metal and coke production still very high. Prices for premium hard coking coals have surged through US$200/t, and could go higher in September. International miners are doing what they can to meet demand, but are struggling to meet the need for greater imports into China, the EU, India and Brazil. However, slowing Chinese steel demand, and environmentally-driven production cuts at steel and coke plants from as early as October, should see a softening in coal demand and lower prices towards year end, and into Q1 2018. Average 2018 prices will be lower than this year, but we have increased our price forecast to over US$145/t for next year to account for continued high coal demand in China, and greater constraints on Chinese coal supply.

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  • Global metallurgical coal short-term outlook August 2017: Supply concerns prolong the bull run PDF - 332.29 KB 10 Pages, 1 Tables, 6 Figures
  • cms metallurgical trade short term outlook August 2017.xls XLS - 2.16 MB

Description

Global coal markets are facing extraordinary challenges and uncertainties. Factors such as global overcapacity, weakening demand and falling prices have created cautious investors. These factors have caused delays and cancellations of many mine and infrastructure projects, as well as lower growth rates at others.

This Metallurgical Coal Market Short Term Outlook report gives global and regional coal producers, consumers, transporters and investors detailed supply, demand and price forecasts for the coal industry, covering all the key domestic markets in North America, China and India.

Use this report to gain a better understanding of market dynamics, including revenue and demand potential for different coals. It will also help you identify trade patterns and changes affecting the metallurgical coal markets.

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 investments.

From market dynamics to trade patterns, we give you confidence in your strategic planning.

  • Executive summary
    • Key market data
  • Prices
    • The winter will bring a change in fortunes
    • Prices will fall, but more slowly than we previously forecast
    • Coal import restrictions into China are a growing risk
      • Key prices – history and forecast, US$/t nominal
  • Supply
    • Russian supply hurt by flooding
    • Mine accidents and geological conditions affecting Chinese coal production
    • US supply breaks the 20 Mt barrier in H1
      • Mission Coal producing again at Oak Grove
      • Corsa opens another low-volatile mine in Pennsylvania
      • Arch Coal sells Lone Mountain to Revelation
    • Canadian exports boosted by mine restarts
  • Demand
    • Chinese government moves to curb Mongolian imports

In this report there are 7 tables or charts, including:

  • Executive summary
    • Executive summary: Table 1
  • Prices
    • Prices: Image 1
  • Supply
    • Queensland metallurgical coal exports
  • Demand
    • Global and Chinese steel production, Mt
    • Steel production – other majors, Mt
    • Global and Chinese blast furnace iron production, Mt
    • Blast furnace iron production – other majors, Mt
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