Coal 02 (Jul 12 - Dec 18)

Coal 02 (Jul 12 - Dec 18)

Postby winston » Wed Jan 12, 2011 9:17 pm

A HUGE "CHINDIA" TREND THAT WILL LAST FOR YEARS

A small edit to our "buy coal" advice from last fall¦ Make sure it's American coal¦

The "buy coal" thesis is simple: Giant developing nations like China and India ("Chindia") are relatively poor compared to the U.S. But these Chindia folks are working their tails off to live "richer" lives. This involves burning a lot more coal to make steel and produce the electricity that lights up factories, cell phones, refrigerators, computers, and televisions. Neither nation can meet its surging needs with domestic supplies.

Last week, catastrophic floods struck Australia, one of the world's largest coal-producing countries. The floods "shut in" a giant chunk of the world's coal production. This is a terrible tragedy for the Aussies ¦ But it has the side effect of making non-Australian coal assets much more valuable.

As you can see from today's chart of the big, mostly non-Aussie, coal investment fund (KOL), this new development has helped push along one of the biggest trends in the world¦ the increasing value of coal producers and their assets. While this big trend is due for a short-term breather, it's one that will grind higher for years.


http://www.dailywealth.com
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Coal 02 (Jul 12 - Dec 15)

Postby winston » Tue Jul 03, 2012 8:56 am

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DJ MARKET TALK: DBSV Tips Limited Downside For Coal Prices

0813 [Dow Jones] DBS Vickers tips limited downside to coal prices as they are near production cost, and expects coal prices to recover gradually in 2H12 and stay above US$80/ton.

The house says China coal demand (44% of global coal demand) should improve in 2H12 following active fiscal policies to maintain growth, but visibility is poor for the longer term as the global macro outlook remains uncertain due to the eurozone crisis.

Among Chinese miners, DBS prefers large state-owned firms and its top picks are Shenhua Energy (1088.HK) for the most resilient earnings from coal-rail-power integrated operations, and China Coal (1898.HK) for improved execution in cost control, a clear map for capacity growth, and potential injections from its parent.

Shenhua rose 3.2% to HK$27.05 Friday but is down 19.7% year-to-date, compared to the HSI's 5.5% rise.


Source: Dow Jones Newswire
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Re: Coal 01 (May 08 - Jul 12)

Postby winston » Tue Jul 03, 2012 4:36 pm

NDRC launches research, may cancel 2-track coal price mechanism

From 21st Century Business Herald, National Development and Reform Commission (NDRC) and certain departments have launched a research related to the coal market.

The goal of the research is to understand the operations of coal business and local coal market construction.

At the moment, China is adopting a two-track coal price mechanism, which separates key power fuel contract price from the market coal price

Theoretically, it is a high time to cancel the key power fuel price as market coal is now close to the former.

Source: AAStocks Financial News
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Re: Coal 01 (May 08 - Jul 12)

Postby winston » Wed Jul 04, 2012 2:36 pm

DJ MARKET TALK: China Coal Plays Rise; Too Early To Call Bottom-Nomura

1410 [Dow Jones] China coal stocks string together a powerful three-session rally, with blue chips China Shenhua (1088.HK) and China Coal (1898.HK) both gaining more than 10% in three trading days.

While coal prices have stopped falling, they have not staged a strong rebound.

Nomura says it recently attended a coal conference in Beijing. "Overall, the tone from industry associations and corporates was cautious, with a majority believing that domestic coal prices have yet to hit the bottom."

The house says factors including waning coal-fired generation, a high influx of cheap coal and excessive coal stockpiles across China will continue to weigh on the coal market outlook in 2H12, hence it's "too early to call a bottom in coal prices."

China Coal is up 4.4% at HK$6.92 while Shenhua adds 3.0% to HK$29.00.

Source: Dow Jones Newswire
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Re: Coal 01 (May 08 - Jul 12)

Postby winston » Thu Jul 05, 2012 8:24 am

While the "expert" analysts are telling you that coal prices will continue to drop, Coal stocks have been on fire. Go figure ..

No Bottom in Sight for China Coal Prices: Analyst
By: Jean Chua

Coal prices in China have fallen almost 20 percent since the beginning of the year, with analysts expecting further declines as inventories remain high and coal mines in China continue to ramp up production.

http://www.cnbc.com/id/48068335
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Re: Coal 01 (May 08 - Jul 12)

Postby winston » Thu Jul 05, 2012 2:18 pm

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DJ MARKET TALK: Coal Stocks Retreat; Coal Price May Stabilize -CS

1327 [Dow Jones] China coal stocks succumb to profit-taking, albeit very modest, with China Shenhua (1088.HK) edging down 0.2% to HK$28.90 after rallying 10.5% over the past three sessions, while China Coal (1898.HK) is down 0.7% at HK$6.90 after a 3-session 14.1% surge.

Credit Suisse says at 10X-11X P/E on earnings based on US$90/ton coal price (or 9X-10X P/E on US$100/ton coal price), Shenhua and China Coal already factored in a conservative case of coal price.

With seaborne price rebounding from the bottom, the convergence of parity price between China and imports, the potential stabilisation of domestic coal price should serve as a positive catalyst.

Separately, KGI says major coal plays are trading at 7X-10X prospective P/Es, which is "fairly valued only;" although it expects coal price is close to a near-term bottom, it might still take some time to rebound.

"We suggest investors to be patient at current level and accumulate the sector only during weakness."


Source: Dow Jones Newswire
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Re: Coal 01 (May 08 - Jul 12)

Postby winston » Fri Jul 06, 2012 8:57 am

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DJ MARKET TALK: Daiwa Cuts China Coal Sector To Neutral Vs Positive

0829 [Dow Jones] Daiwa cuts China's coal sector to Neutral from Positive, noting weak demand and sufficient supply have dragged down seaborne coal prices; "we see rising downward pressure on China prices."

The house adds, in response to rises in inventory, coal producers have started to slow production growth, but further cuts seem necessary; to reflect lower coal prices and sales volumes, Daiwa cuts its EPS forecasts for China coal stocks by 7%-33% for FY12 and 11%-26% for FY13.

It says China Shenhua (1088.HK) is the least affected due to its integrated business model and good cost control, and hence it's the top sector pick and it advises investors to accumulate shares "on the current weakness."

Shenhua edged up 0.3% to HK$29.05 Thursday, rebounding 11.1% over the past five sessions.


Source: Dow Jones Newswire
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Re: Coal 01 (May 08 - Jul 12)

Postby winston » Tue Jul 10, 2012 11:54 am

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DJ COAL DATA: China 1H 2012 Coal Imports 140 Mln Tons, Up 65.9% On Year -Customs By Wayne Ma and Sarah Chen

BEIJING--China imported 140 million metric tons of coal in the first half of 2012, up 65.9% compared with the same period a year earlier, the General Administration of Customs said Tuesday.

It didn't specify whether the coal import figure included other types of categories such as coking coal, anthracite or coke and semi-coke.

However, China imported just 70.5 million tons of coal in the first half of 2011.

Source: Dow Jones Newswire
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Re: Coal 01 (May 08 - Jul 12)

Postby winston » Fri Jul 13, 2012 8:45 pm

China's coal stocks grow higher

If you are looking for an example of China's economic slowdown, visit the country's biggest coal port.

The huge stockpiles of coal are growing ever higher as factories and power plants cut back.

http://www.bbc.co.uk/news/business-18823668
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Re: Coal 01 (May 08 - Jul 12)

Postby winston » Mon Jul 16, 2012 5:05 pm

Wilbur Ross Says U.S. Coal Is Facing Years of Headwinds: Energy

Billionaire Wilbur Ross, who built a company from distressed U.S. coal assets and sold it last year for $3.4 billion, says the industry’s current slump differs from earlier setbacks and may last for years because of the shale-gas boom.


http://www.bloomberg.com/news/2012-07-1 ... winds.html
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