Coal Companies Wrongfully Smashed by China Imports Data
Companies that we like such as Alpha Natural Resources (ANR) and the new IPO Cloud Peak Energy (CLD) were all hit hard today especially in comparison to the strong gains in the market. ANR was down 5% from its high around the opening bell.
- U.S. coal mining shares fell on Monday after data showed China's coal imports dropped 11 percent in the last month, even though exporters expect a booming market in the Pacific region for the next few years.
- Indeed, the latest official Chinese customs data showed coal imports rose 219.5 percent from a year earlier to 11.14 million tonnes in October.
- But the October volume was 11.2 percent lower than in September, Reuters calculation showed. China's coal imports hit a record high of 16.07 million tonnes in June.
- Just this month, Peabody Energy (BTU.N) Chief Executive Greg Boyce said he expects seaborne coal trade in the Pacific region to grow by more than 7 percent annually for several years, underpinned by robust demand from China and India.
- China began importing huge volumes of coal due to the shutdown of many unsafe mines in the country.
- The death toll from China’s worst coal-mine disaster in almost two years rose to 104 as authorities criticized safety lapses and dismissed senior management of the pit in the country’s northeast.
Stay long and strong as this was a massive buying opportunity. The trend didn't change because of this report and should've been further enhanced by the safety issues in China pushing them more towards imports.