Commodity market report

Global thermal coal short-term outlook September 2016

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Report summary

Years of supply rationalisation and spot prices below the marginal cost of production have left seaborne thermal and metallurgical markets unable to quickly respond to a modest, China-inspired demand shock. The result has been significant price spikes in these markets.

What's included

This report contains

  • Document

    wm coal monthly thermal trade September 2016.xls

    XLS 1.62 MB

  • Document

    Global thermal coal short-term outlook September 2016

    PDF 560.29 KB

  • Document

    Global thermal coal short-term outlook September 2016

    ZIP 1.79 MB

Table of contents

  • Executive summary
    • How much of the recent price increase is due to short-term rather than long-term factors?
    • Europe set for uncertain winter dynamics
    • Market constraints restrict coal-to-LNG switching in Japan and South Korea
    • China demand in the coming months
    • Increased logistics expenses drive commodity prices upward
    • Metallurgical coal prices approach bubble territory: here's why they matter for thermal coal
    • China matters: but policy direction is still not clear
    • Australian exports
    • Colombia: community and government intervention will remain an ongoing issue but producers continue to expand exports
    • US: higher natural gas prices in 2017 will increase thermal demand

Tables and charts

This report includes 13 images and tables including:


  • Key market data
  • Premium/discount of ARA to Newcastle (US$/t)
  • Premium/discount Richards Bay to Newcastle (US$/t)
  • Key prices: history and forecast, nominal US$/t
  • Export margin evolution over past four months (US$/t)
  • Marginal cost of production versus spot price (US$/t)
  • Historical Japan and South Korea switching and fuel prices (US$/mmbtu)
  • Monthly coal-fired generation (TWh)
  • China gencos daily burn (Mt)
  • Seaborne Pacific demand for thermal coal by country (Mt)
  • Global dry bulk capesize shipping rates (US$/t)
  • Average weekly FOB Qinhuangdao 5,500 kcal/kg coal price (RMB/t) and policy
  • Price tiers for supply increase/decrease

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