As Hogsback predicted on July 1, Glencore is in a position where it effectively rules the thermal coal universe.
The Switzerland-based behemoth is the largest thermal coal producer in Australia and a major player in the thermal coal seaborne trade.
It has reached a size where it can effectively move markets by controlling the majority of supply.
Glencore's half-yearly report states its thermal coal's adjusted earnings before interest, tax, depreciation and amortisation rose 309% to US$3.2 billion in the six months to December.
Revenues from its Australian thermal coal rose 73% in 2021 to $6.9 billion.
Its coking coal revenue for the half year to December 2021, while more modest at $1.9 billion, increased 103% over 2020's result.
Its coking coal adjusted EBITDA rose a healthy 293% to $959 million.
Despite the cacophony of criticism from environmentalists over the past 12 months declaring thermal coal was dead and buried Glencore and its shareholders have enjoyed another bountiful year because of the black stuff.
The company increased capex on its Australian thermal and metallurgical coal operation in 2021 by $19 million over the previous year to $565 million.
Of that amount $411 million was sustaining capex while the remaining $154 million was to expand its operations.
Shareholders in BHP - who have just learned they will be paid a fat dividend - should also be thankful for coal's contribution to the company's balance sheet.
In the six months to December 2021, BHP reported revenues of $5.3 billion and underlying EBITDA of $2.6 billion.
This compares with revenues of $2.1 billion and a loss of $201 million in December 2020.
The ability to stick with coal despite all the negative publicity and the volatile coal price will continue to pay for BHP even though the company has been pressured into selling its BHP Mitsui Coal assets in Queensland to Stanmore Resources and its Energy Coal operations in New South Wales.
BHP's remaining coal operations are expected to deliver even more profits in the next half because conditions should improve.
The Big Australian's Queensland Coal unit costs were tracking above the revised guidance range at the half year primarily due to lower volumes in the first half due to significant wet weather impacts and labour constraints.
"A stronger second half performance is expected following planned maintenance undertaken in the first half, however, COVID-19 related absenteeism impacts remain a risk for the second half of the 2022 financial year," the company said.
Hogsback reckons Glencore and BHP know they are on a good thing with coal and they would be foolish to let their shareholders miss out on the rivers of gold to come in the future.
