“Investing in coal stocks, based on the local market, and looking at the world, these two factors are the most noteworthy.†This is the “Coal Jing†of Gong Yunhua, an analyst of the Guojin Securities Research Group, the No. 1 analyst in the coal mining industry. Gong now works for Qilu Securities.)
China's demand is the main contradiction in the coal industry Gong Yunhua believes that since 2000, the development of China's coal industry has experienced a period of rapid development, not just volume growth, but also a qualitative leap. Under the background of the consolidation of coal resources and the continuous deepening of mergers and acquisitions in various regions, the country's coal industry layout has basically taken shape. However, during the “12th Five-Year Plan†period, the integration and merger and reorganization of the coal industry will continue.
It is understood that since the second half of 2009, China's coal imports have increased significantly. In the first three quarters of this year, the country imported more than 120 million tons of coal. At present, China's imports account for 30% of the entire Asia-Pacific market and demand is very strong. It is expected that China's demand will dominate in 2011.
Gong Yunhua said that from the perspective of the consumption situation this year, the supply and demand of thermal coal and coking coal are basically in line with expectations. For coal prices in 2011, he expects thermal coal contract prices to be around $105/tonne and coking coals at $225/tonne. He said that coking coal is now priced quarterly, but by the second half of next year, coking coal prices, especially international coking coal prices, will have a very significant increase.
Coal and U.S. dollar are highly correlated With the high growth and cumulative benefits brought about by the global quantitative easing currency in 2009, Gong Yunhua believes that the inertial growth of asset prices will continue. Judging from past historical experience, in the first half of the monetary policy contraction, capital prices are basically in a rising trend.
Gong Yunhua also said that the appreciation of the Australian dollar will push up international coal prices. With the current domestic import volume maintained at a high level, the rise in international coal prices can be easily transmitted to the domestic market. Coal prices in 2011 are also likely to rise more than expected.
China's demand is the main contradiction in the coal industry Gong Yunhua believes that since 2000, the development of China's coal industry has experienced a period of rapid development, not just volume growth, but also a qualitative leap. Under the background of the consolidation of coal resources and the continuous deepening of mergers and acquisitions in various regions, the country's coal industry layout has basically taken shape. However, during the “12th Five-Year Plan†period, the integration and merger and reorganization of the coal industry will continue.
It is understood that since the second half of 2009, China's coal imports have increased significantly. In the first three quarters of this year, the country imported more than 120 million tons of coal. At present, China's imports account for 30% of the entire Asia-Pacific market and demand is very strong. It is expected that China's demand will dominate in 2011.
Gong Yunhua said that from the perspective of the consumption situation this year, the supply and demand of thermal coal and coking coal are basically in line with expectations. For coal prices in 2011, he expects thermal coal contract prices to be around $105/tonne and coking coals at $225/tonne. He said that coking coal is now priced quarterly, but by the second half of next year, coking coal prices, especially international coking coal prices, will have a very significant increase.
Coal and U.S. dollar are highly correlated With the high growth and cumulative benefits brought about by the global quantitative easing currency in 2009, Gong Yunhua believes that the inertial growth of asset prices will continue. Judging from past historical experience, in the first half of the monetary policy contraction, capital prices are basically in a rising trend.
Gong Yunhua also said that the appreciation of the Australian dollar will push up international coal prices. With the current domestic import volume maintained at a high level, the rise in international coal prices can be easily transmitted to the domestic market. Coal prices in 2011 are also likely to rise more than expected.