They cant cover. The covered 2 million over 6 months last year and the price went up $10. They will continue the games for a few more weeks and then when more cuts come prices and coal prices rise they will cover when prices are already much higher. Wlt will go much higher than it deserves.
Reuters reported that Chinese coal prices are now close to their bottom after a long decline brought about by slowing demand and excess supply.
Mr Gong Qingchao head of sales and executive director with the China Coal Group said that "I think prices are bottoming out and are unlikely to fall a lot more given the sector-wide losses and rising costs."
Mr Gong said that about a third of China's coal miners were making losses in 2013 and a further fall in prices this year has meant that an estimated 80 percent of the total are in the red.
Tumbling prices, caused by weaker demand due to slowing growth in China and a flood of cheaper imports, have forced many smaller miners out of business, while a slew of majors, including Shenhua Energy and Yanzhou Coal, reported losses for their 2013 results.
World's number one miner BHP Billiton under ex-CEO Marius Kloppers deserve (and take) much of the credit for dragging the iron ore market out of the financial stone age.
By pushing hard against bigger rivals Vale and Rio Tinto which favoured the old annual negotiated contract system, in 2009 BHP helped double the price of iron ore overnight.
Just for good measure, free-on-board pricing were also dropped in favour of CFR which gave Australian producers a huge advantage over South African and particularly Vale's Brazilian ore, reaping billions for the industry.
BHP has been working hard to repeat the 2010 move in the coking coal market, but has so far met with little success.
The main pushback from steel mills against spot pricing has to with the variability of the coal produced from one mine to the other, which is especially true in number two importer of metallurgical coal Japan.
The negotiations are happening during a difficult time for the coking coal trade which this year should amount to some 320 million tonnes.
Quarterly benchmark coking coal traded as high as $330 a tonne in mid-2011 after bad weather took much of Australia's supply off the market. The price of the commodity stayed above $200 for two years between September 2010 and September 2012, but has been on a steady downtrend since then.
Second quarter 2014 contracts have been inked at $120 a tonne, down 14% from first quarter benchmarks and the lowest since 2008.
BHP has this almost religious belief that unless commodities trade on index or there are derivatives then it’s not a mature market"
BHP, the globe's top exporter of coking coal, has put its money where its mouth is and is selling an ever increasing portion on the spot market.
Trouble is, BHP is losing big money on its push.
According to data supplied by The SteelIndex spot Australian hard coking coal (FOB Australian east coast exports) this week sold at $98 a tonne.
That's up just a fraction from the lowest since the price provider
He is a paid shill who simply put laid out the shorts ideas in exchange for 10k. Since the shorts are paying idiots to put this stuff up it indicates they are nervous some of the 53% short interest is loosing nerve. Buy all you can.
I like all longs was left a little deflated by this weeks price action. Monday and Tuesday broke out of the long term downtrend lines and were going to set up a decent run from a technical chart standpoint. Not just WLT but most /all coal names. The establishment called in a favor and we were all hit with the downgrade. The technical guys tried to rally it at the open but were overwhelmed by sellers as well as a 300 point downdraft in the Dow. Broken, the technical guys had to cover and that led to the fall Friday. But, overall gas price has been rising and coal inventories are hitting bottom. Can't move or even use much more powder river coal as it competes with oil for space and the economics of moving western canada / Bakken oil are better than coal. Gas price will need to rise higher to move demand from gas to coal to allow refill of storage so the overall fundamentals are good in North America. Not directly helping met coal but the central Appalachian coal is a close substitute for met and is often mixed with met to meet Lower requirements so it might lower supply some. When the 110/ton will bring the marginal suppliers to their senses and creates big production cuts is a big question. It may sound weird but the best thing for Walter is to keep the Asia prices low so they cut production. WLT will net $20 higher as Europe is a better market and their coal is top spec. It's hurts them more than WLT.
Seems the market was making a point that the coals are not ready to fly. Probably should content yourself to sell some into rallies. We need curtailments in production. The gas price will go higher in the US to grab demand back but we really need Met prices to fly. Some time away.
Hedge Fund Shorts to Brokerages (UBS & Goldman): Guys you need to do something the coals are moving up. The Short Interest Report is out on Friday and it’s going to show we are 60% short on WLT. Somebody is going to squeeze us when they see that we have overextended ourselves.
Brokerages to Hedge Funds: Don’t worry we will issue another downgrade. Goldman comments on WLT, ACI & ANR and UBS downgrades.
Hedge Funds Leadership to own Traders: Short more WLT at open. We will cover lower later.
Brokerages to their traders: Buy all you can. Time to squeeze the shorts on coal names.
The short interest is likely 35million. Just not that many shares left for shorting. Plus the qtr is over the shorts got the bonus for year. Hedge fund year ends in march. Half the traders are starting at another fund this week anyway. As long as price of met coal stays around 110 /ton a bit more the production cuts will roll in and the market will find itself short and we will be in a boom market. No dilution at WLT so just as explosive to the upside as before. Shorts will cover but probably a battle over the next 2 months.
Take what money? The cash cost is 160-180 on a lot of their mines. They are bleeding red ink. BHP is in denial on coal. They can't accept that they made a bad decision. Putting off hard decisions is in nobodies interest especially their shareholders. They will cut. Going from 140 / ton to 110 /ton was a blessing as it will force the decision. Good luck shorts. Shorting at this level is short sighted.
BHP needs to fire press people and get on with reducing supply. One release says that coal prices will remain low for long time, next says they are going to spin some business off including some coal, next says coal strong for decades to come. Well, why not make it good back half of 2014 and shut in 20% of capacity and make some money idiots.
Small float. 34+ shorts. No volume. Boom bust commodity stock. Shorts you will soon hate WLT. It's going to happen.
(BN) South Africa’s Richards Bay March Coal Exports Drop 29% Y/y
South Africa’s Richards Bay March Coal Exports Drop 29% Y/y
2014-04-01 12:59:29.599 GMT
By Alessandro Vitelli
April 1 (Bloomberg) -- The following table shows unloadings, exports and stocks of coal at South Africa’s Richards Bay coal terminal for the month of March. Data is compiled from daily reports published on the terminal’s website.
MTD Y/Y Avg. daily YTD
total change for MTD total
Offloadings 5.141m -21% 205,649 14.888m
Exports 5.345m -29% 213,815 14.402m
Stocks (avg.) -6.2% 3.167m 3.456m
Offloadings are deliveries by rail to the port.
All data in metric tons
Western Canadian Coal to cut operations at the Brule and Wolverine operations
2009-01-06 17:53:00.0 GMT
Western Canadian Coal to cut operations at the Brule and Wolverine operations
(Canadian Press) -- VANCOUVER -- Western Canadian Coal Corp. (TSX:WTN), a Vancouver-based coal producer, says it plans to reduce operations at its Brule mine and Wolverine operation in British Columbia, affecting hundreds of jobs, because of reduced demand from steelmakers.
Western Canadian said Tuesday it will cut output at the Brule mine, which produces lower quality coal, to about 750,000 tonnes a year from its current rate of 1.3 million tonnes.
The reduction is effective at the end of January.
Meanwhile, the Wolverine operation, which produces hard- coking coal, has told employees it may cut operations effective May 18, subject to market conditions for the next coal year, the company said.
The company said 35 of its contractor's employees will be affected at Brule mine near Chetwynd, B.C.
It said the number of jobs impacted at Wolverine, located just outside of Tumbler Ridge, B.C., is unclear at this stage, but that 300 of its contractor's employees and 100 of the company's own employees were given notice Tuesday.
The coal producer employed 530 people at the end of 2007.
Western Canadian also said it has given notice to the contractor at Wolverine to end the mining operation contract.
The Wolverine operation has a current annual capacity of 1.6 million tonnes of coal.
The Vancouver company said the reduced operating rates reflect rising inventories as some customers defer shipments through the next few months. Western Canadian said it expects to operate at the lower rates until the current economic uncertainty improves and the demand for coal becomes clearer.
I emphasize these plans are contingent on what the demand of metallurgical coal will be for the next coal year," said John Hogg, president and CEO of Western Canadian.