[CAMWEST-discuss] Coal in Early Phase of ‘Super Cycle’

Danny Hannan danny_hannan at yahoo.com
Fri Jun 25 00:01:06 UTC 2010

I apologise for the doom and gloom but that is how the data presents, but the information can provide arms for those who wish to change our direction for the better and/or protect themselves as best they can from the coming crises.

The substance of this article is confirmed by both my own research and global and Australian coal production figures; production increasing at 4-5% per year, the situation will worsen as coal is used to replace the energy from oil when flat global oil production goes into permanent decline in the next few years (my bet for demand/supply crossover is 2012 with associated oil price spikes).  There is a world shortage of coking coal for the production of metals, this shortage is projected to only get worse.  Coking coal has already exceeded US$300/tonne and my bet is a price over US$500/tonne by 2015, the price of steel will then become limiting for development and the demand for iron ore may falter.

So much for reducing global CO2 emissions.


Peabody Says Coal in Early Phase of ‘Super Cycle’ (Update1) 
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By Mario Parker and Noah Buhayar
June 24 (Bloomberg) -- Global demand for coal is at the beginning of a multiyear growth period, driven by consumption from China and India and the recovering U.S. economy, Peabody Energy Corp. said today. 
“We’re in the early stages of a 30-year super cycle in global coal markets,” Chief Executive Officer Gregory Boyce said at the IHS McCloskey Group Coal USA Conference in New York. 
Peabody, the biggest U.S. coal producer, operates eight mines in Australia’s Queensland and New South Wales states and is targeting the Asia Pacific region for growth to feed power stations and steel mills in China. 
China, the world’s largest user of coal, increased imports of the fuel by 17 percent from a year earlier to 11 million metric tons, according to data released June 20 by the General Administration of Customs. 
Peabody fell 38 cents, or 1 percent, to $42.45 at 9:54 a.m. in New York Stock Exchange composite trading. The shares have fallen 6 percent this year. 
Global steel demand will surge 50 percent by 2020 leading to more consumption of metallurgical coal, used to make steel, Boyce said. 
JFE Holdings Inc., Japan’s second-largest steelmaker, and two rivals agreed to a $225-a-metric-ton-coking-coal contract for the July-to-September quarter, 13 percent higher than the $200 a ton for the three months started April 1, three people with knowledge of the agreements said. The contract is considered an industry benchmark. 
Asian Shipments 
Peabody is shipping coal mined from Wyoming’s Powder River Basin to China, Korea and Chile, Boyce said. The region holds the largest and least expensive U.S. reserves of coal. 
“We’re also seeing rising export potential not only from the East Coast, but from the Illinois Basin” and the Powder River Basin, he said. 
Boyce said the company is working to develop a port on the U.S. West Coast to supply the Pacific markets. He declined to disclose a time frame as to when it will be built. 
“The real goal here is to see if we can’t get large volumes of Powder River Basin coal to Asia,” Boyce said. 
The U.S., which holds the world’s largest reserves of coal, relies on the fuel for about half of its power generation, compared with about 20 percent for natural gas. 
To contact the reporters on this story: Mario Parker in New York at 
 danny_hannan at yahoo.com 

From: Matt <mushalik at tpg.com.au>
To: Matt Mushalik <mushalik at tpg.com.au>
Sent: Fri, 25 June, 2010 9:12:50 AM
Subject: M2 widening in Sydney: primary energy dilemma for cars

Hi all,

many new articles on my website:

M2 widening: Primary Energy Dilemma for cars

BP Statistical Review June 2010: Oil reserves and production don't match

Brisbane Motorists bypass the Bypass Tunnel

GOM oil after the US peak

Oil spill wil have similar effect like Piper Alpha accident after the
1st UK oil peak: re-design

900 kb/d less offshore by 2015


Matt Mushalik (MIEAust, CPEng)
Epping 2121


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