Mongolian Mining Corp. (MOGLF)

[OMOLIVES]

Coking coal futures have been stronger/static more so than I would have thought. That pessimistic side of me that is. The past two Months have pushed the bar up. About two more to go.....so?



Coking coal prices are currently sufficiently high that cost inflation has not undermined profitability. CRU estimates that the seaborne industry generated an average cash margin of 40% in 2016-2017, and profitability has remained very strong this year.

The metallurgical coal market is unlikely to become oversupplied in the near term, and Fitch does not expect prices to fall deep into the cost curve, as they did during 2014-2016. However, prices have already eased off from their peak of USD260/tonne in 4Q16, and are likely to decline further as supply constraints continue to ease. Fitch’s current assumptions are that hard coking coal prices will average USD185/tonne this year and USD140/tonne thereafter. These declines could put pressure on some less competitive mining companies to reduce costs to protect margins.

https://www.hellenicshippingnews.com/fitch-ratings-metallurgical-coal-miners-may-curb-costs-as-prices-slip/