Wed, October 19, 2016 2:28 am
Already Q4: Somehow it is already Q4 and while this year began with little fanfare, it appears it will not go out quietly. Ted and Jim just returned from a week in Japan where they spent every moment trying to get a bead on where the Oct – Dec coking coal settlement will land, what is happening with the thermal settlement, what is happening in China, and does this rally have legs? We have taken all their great intel and weaved it into our models to provide you even more of the great research you have come to expect from DTC. Sometimes the extra mile happens half way around the globe! We appreciate your continued support of our efforts- Team DTC.
1. Production Coming Back: Hot weather, rising prices and falling inventories are music to every coal producer’s ears. With the markets heating up, production is bound to follow. See how much coal each basin will likely produce through 2018.
2. Coking Coal Play by Play: Are you new to coal, or returning to the sector due to the dramatic rally in coking coal prices that has captured mainstream media attention? Our new Coking Coal Play by Play bonus section of the price move over the past month starts on page 113 and will get you up to speed with one epic rally.
3. Coal Price Forecasts – Raising the Bar: The bull is out of the bag, and after an epic month in coking coal that helped drive big gains in thermal coal, we had little choice but to revise our price forecasts higher.
4. EIA Q2 Revisions-Nailed It: We don’t want to be “braggadocious” but our estimates were pretty darn good this quarter. Total US production was revised by the EIA to +6.83 mm tons vs a DTC estimate of +6.86 mm tons.
5. Cheap Gas Threatens Coal in Northeast: The recent rise in coal prices has coincided with a new plunge in natgas prices around the Marcellus shale region, but elsewhere the playing field is closer to level.
6. September Coal Gen Up YoY in Central US: Data from the two most coal-heavy power markets shows September coal generation was up from 2015.
7. Conference Tour 2016 Continues: The conference tour never seems to end, and it’s more exciting to attend conferences with all the buzz around the recent jump in seaborne prices. Next week, Ted is back on the plane and headed to another Coaltrans, this one in Lisbon Portugal, and Jack is off to the MetCoke World Summit in Pittsburgh to get the latest and greatest on the U.S. coking coal market.