A little perspective The benchmark price for metallurgical coal has dropped to a multi-year low of US$119 per tonne, and Moody’s Investors Service doesn’t see much relief for met coal producers until the second half of 2016. In the meantime, it warns, protracted price weakness could bring downward rating actions.
Spot prices for high-quality met coal “show no upward momentum,” Moody’s commented in an Oct. 31 research report. “At the same time, tepid market indicators out of China, a weak global economy and slow supplier response make any material price recovery unlikely.”
The analysts write that while production cuts “will ultimately bring benchmark prices closer to the US$135- to US$145-per-tonne marginal cost of production, we now believe that will take longer.”
- See more at: https://www.northernminer.com/news/met-coal-producers-should-steel-themselves-for-long-price-weakness/1003336195/?&er=NA#sthash.uV1Kr8gx.dpuf