Coal's Perfect Storm Morphs into a Robust Price Trend

Source: Mineweb.com (7/8/08)

Although coking and thermal coal prices soared by 200% to 300% this year in response to a perfect storm of short-term events including Queensland, Australia, floods, coal export bans in China, and the South African energy crisis, Citigroup forecast Monday that coal prices will remain robust.

While the perfect storm has abated, Citigroup mining analysts Alan Heap and Alex Tonks, both based in Australia, suggest that "limited potential for new supply means the coking coal market is expected to remain tight for many years." Coking coal spot prices are around US$385.t, up $85 since January and above contract prices since 2000. Xstrata is believed to have recently settled at US$360/t for JFY 2008-2009, according to Citigroup.

Heap and Tonks assert that the supply-demand outlook points to persisting supply deficits of coking coal. "Further, it is difficult to identify additional supply sources which will meet the shortfall, even in response to higher prices," they said." The most likely response will be reduced steel production as mills run short of coal. Indian steel producers are the most vulnerable."

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Source: Streetwise Reports (07/13/2020)

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"China's export quota could be opportunity for Canadian miners"

Mexico: Gold's Next Powerhouse Player
Source: Marc Davis, BNW News (11/03/2009)

As the world's key gold producing nations struggle mostly in vain to replenish dwindling below-ground supplies, Mexico is bucking the trend in a big way.

Where Have All the Gold Mines Gone?
Source: Brent Cook, Exploration Insights (04/14/2009)

Given the declining global gold production, mining companies’ demand for reserve replacement and the acute dearth of new gold discoveries, there is no doubt that real economic discoveries will be exceptionally valuable. . .the opportunity for stellar profits is the best it has probably ever been. Identifying the few successes, however, will require vigilant and constant technical assessment of geology and drill results, always with an eye to mine economics.

Congo Completes Mining Review, Says Majors Quit Talks
Source: Reuters (12/20/2008)

"Review process is extended an additional 45 days to allow six companies to return to the negotiating table for direct talks with government ministers."