China Offers Massive Market Opportunity for Mongolhttps://www.chinasignpost.com/2012/08/north-central-china-offers-massive-market-opportunity-for-mongolian-coal-miners/
Mongolian coal projects should expect to operate on Chinese regional coal prices, which will likely rise closer to global seaborne prices as the Chinese government consolidates the mining sector and caps domestic coal production by 2015 and China’s proportion of seaborne thermal coal supply rises. Investors should also look beyond rail routes through Russia and consider alternative ways of monetizing coal reserves such as mine mouth power plants that use ultrahigh voltage power lines to move electricity to markets in China and Russia as well as coal-to-liquids (CTL) and coal-to-chemicals (CTC) plants. These approaches can capitalize on growing coal demand in Western and Central China and can improve Mongolian coal miners’ pricing power by putting Chinese coal traders on notice that the coal they want could alternatively be sold as electrons, motor fuel, or petrochemicals.