Booming thermal coal price on China demand cheers miners – by Henning Gloystein and Jim Regan (Reuters U.K. – August 17, 2017)
SINGAPORE/SYDNEY (Reuters) – Australian thermal coal prices for spot cargoes above $100 a tonne, lifted by reports of strikes and strong Chinese demand, are providing a boost in earnings and share prices for miners like Glencore and Whitehaven Coal.
A crackdown on illegal mining and pollution in China has curbed domestic supplies, just as a heat wave and lower hydro power output have boosted demand for coal for power generation, forcing up prices. A similar squeeze in 2016 pushed prices to $114 a tonne and miners are again eyeing windfall profits, despite warning that the market is volatile.
“Coal demand remains strong, especially in Asia,” said Paul Flynn, managing director of Whitehaven Coal (WHC.AX). “Imports of thermal coal into China have been higher than anticipated, and when combined with weather related constraints on supply from Indonesia and some production issues in Australia, have pushed up the price of seaborne thermal coal.”
Reports of more planned strikes at Australia’s Hunter Valley mine, as well as weather-related supply disruptions in Indonesia, have also been pushing up prices, traders said.
Adding fuel to the already hot market, a huge gas-fired power outage in Taiwan this week has triggered emergency orders from coal-fired power stations scrambling to fill the electricity production gap, traders said.
For the rest of this article: https://uk.reuters.com/article/us-thermal-coal-prices-idUKKCN1AX0I9