Australia is expected to further enhance its leading position in the global coking coal trade
Australia is expected to further enhance its leading position in the global coking coal trade, due to cost cuts and the depreciation of the Australian dollar margin increased to stimulate the growth of coking coal production, and to pressure the United States and other competitors facing cuts. Australia's major coking coal exporter BHP Billiton will be the biggest beneficiaries of the company and its Japanese partner Mitsubishi and Mitsui supplies accounted for nearly a quarter share of global coking coal trade.
Morgan Stanley analysts said in its latest report released said, Chinese coking coal imports stabilized, high-cost North American manufacturers are out of the market, BHP Billiton will become the world's leading coking coal market supply-side pricing Party . In the past three years, the decline in China's market demand led to commodity prices fall, coking coal and iron ore, the two steel-making raw materials have been hit hardest.
Despite the weak demand outlook, Australian coking coal producers still maintain or increase production this year, the Australian dollar fell by 11 per cent support, since coal is priced in dollars, so this reinforces the effect of reducing costs. This prompted the Australian producers as much as possible the production of various types of coking coal, including hard coking coal, semi-soft coking coal or blast furnace coal injection, etc. These types of coal prices were higher than thermal coal for power generation.
Australian coking coal market in the global ranking of a dominant position, accounting for about 60 percent of global trade sources of supply, which is different from the iron ore market, Australia and Brazil increased supply leads to new iron ore prices fell sharply. Since the Australian official agency estimates that in 2015 - two-year period in 2016, the Australian coking coal exports will increase by 8 million tons, and the estimated amount of US exports over the same period will be reduced by six million tons, and therefore Australia dominate the global coking coal market forces will It will rise further.
Industry analysts for how fast to cut the price of coking coal to play to boost the effect of view there are differences. Morgan Stanley believes that hard coking coal contract prices will hit bottom this year, the price at about $ 90 per ton, then rose to $ 95 in 2016. UBS estimated average price of hard coking coal will touch the bottom of the $ 91 per tonne in 2016, before rebounding to $ 104 in 2017.