Coal stocks ripped higher today on the back of this headline….
MARKET SOURCES SAY CHINA MAY REVERSE ITS UNOFFICIAL BAN ON AUSTRALIAN COAL IMPORTS IN AUGUST OR SEPTEMBER AND SOME STEEL MILLS ARE ALREADY MAKING PREPARATION – SXCOAL.COM.
The backstory is that in 2020 China put bans on using Aussie coal which impacted met coal (used in Steelmaking) more so than thermal coal (used in power generation) suggesting that any ban unwind might benefit met coal volumes and prices. It’s been an amazing couple of years in the coal market – the so called old energy on a pathway to oblivion … yet the best commodity performer in FY22 and the best so far in FY23 to date. This has clearly supported coal stocks with Whitehaven Coal (WHC) being our best portfolio performer during FY22, the company is now printing ~$300m of free cash flow per month, clearly a huge number.
MM is bullish Coal stocks & commodities generally
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