Two coal industry experts who are both must-listen to people when they’re speaking about coal were quoted in a recent article. Neil Bristow, an ex-BHP analyst who now runs his own consulting shop, and Ernie Thrasher, CEO of Xcoal, one of the worlds leading trading firms, both know the coal markets better than almost anyone.
Some key highlights:
- Bristow on coking coal: “My models do not show enough coking coal to meet the demand in the world after about 2027, 2028.”
- Xcoal estimates the UK and Europe alone will need to find 47 million tonnes of coal that used to come from Russia.
- Thrasher on thermal coal: “There is just no elasticity in the supply chain that’s allowing people to respond to these prices, and the old adage of the best thing for high prices is high prices is not holding true.”
- Xcoal estimates the global coal supply gap at 96 million tonnes. Which can only be met by China and/or India.
- If China’s economy were to suddenly recover and grow, that would put even more pressure on both thermal and coking coal prices.
- Bristow: “But I think the days of seeing sub-125, 150 dollars per metric tonne of coking coal for any period of time are in the rear-view mirror, and it’s because the coal simply is not being produced.”
You can read the article in it’s entirety, linked here.
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