Via Morgan Stanley:
2017’s been choppy for all coal markets, thanks to NDRC industry reform confusion + Queensland weather. But these dramas are passing now, supply’s recovering, prices falling…
Supply everywhere, normalizing: First, it was the NDRC who withdrew from its failed 276-day production-capping policy and now we have the passing of Queensland’s TC Debbie ,allowing exports there to resume. Total coal supply rates across both China + industries elsewhere are normalizing. And since the total demand growth across all of these markets has never actually been anything but stable/subdued in recent years (metal&ROCK: The Price Deck – 2Q 2017, Beyond reflation, 13-Mar-17),all key thermal and metallurgical coal product prices are once again under downward pressure.
