Macro optimism for coal prices

IMPROVING fundamentals in the international coal market are tipped to restore profitability to major producers experiencing losses due to poor demand from Europe and China.
Macro optimism for coal prices Macro optimism for coal prices Macro optimism for coal prices Macro optimism for coal prices Macro optimism for coal prices

 

Justin Niessner

High-cost Australian mines, in particular, are expected to rebound on rising coal prices and increased demand in 2013.

According to a Reuters report, Deutsche Bank has called for the stabilization of US gas prices, increased Chinese economic activity and a continued rally in coal prices to strengthen the bottom line for producers and exporters worldwide.

“According to our estimates, the rise in prices since late October has restored profitability to as much as 42 million tonnes of Australian export thermal coal, and 7Mt of Russian export thermal coal production,” the bank said in the report.

This progress was predicted to maintain despite high Chinese coal inventories and the return to production of mines sidelined during recent drops in demand.

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