Commodity market report
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12 Pages

Global metallurgical coal short-term outlook January 2016


Global metallurgical coal short-term outlook January 2016

Report summary

With Australian low-volatile contract prices for Q1 2016 set at US$81/t, one would think we have reached bedrock. However, global demand continues to weaken with largely due to China’s high levels of steel and coke exports. The fall in Australian mining costs is boosted again by further weakening of the AUD during January. These market pressures have caused an acceleration in high-cost mine closures and debt restructuring in the US. And, we forecast the Q2 price to fall further to US$78/t.

What's included?

This report includes 2 file(s)

  • Global metallurgical coal short-term outlook January 2016 PDF - 410.04 KB 12 Pages, 1 Tables, 6 Figures
  • CMS metallurgical trade short term outlook January 2016.xls XLS - 1.73 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
    • Australia delivered costs fall 2% to 3% on lowered tariff to China starting in January
    • Depreciating AUD improves mine costs, while weaker RMB works for Chinese domestic
    • Price forecast has been lowered versus our December update
    • Key prices - history and forecasts (US$/t, nominal)
  • Supply
    • BHP Billiton completes infrastructure for - one more way to lower costs
    • Queensland exports fall slightly from November
    • Queensland ports: metallurgical exports (Mt)
    • Arch Coal files for Chapter 11
    • Walter sells Alabama assets to its seven key lenders
    • Alpha Natural Resources to idle Marfork and Elk Run complexes
    • Cliffs sells coal mines to Virginia Conservation Legacy Fund, which idles Pinnacle mine
    • Peabody Coal to sell thermal mines in effort to reduce debt
    • Blackhawk Mining closes operation
    • Metinvest files for Chapter 15 bankruptcy protection in the US
    • China to close roughly 5,300 small coal mines
  • Demand
    • Massive layoffs at Port Talbot steel mill
    • Brazil’s CSN and Usiminas laying off employees
    • Nippon Steel Sumitomo Metals Corporation (NSSMC) to shut Kimitsu blast furnace
    • India continues steel expansions in the face of increased imports
    • Another US coke oven closure – Shenango
    • Steel and blast furnace iron production rates falling since May 2015

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

  • Executive summary
    • Executive summary: Table 1
  • Prices
    • Prices: Image 1
  • Supply
    • Supply: Image 1
  • Demand
    • Demand: Image 1
    • Demand: Image 2
    • Demand: Image 3
    • Demand: Image 4
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