Coal Seen Dropping Below US$50 in Rout as Output Fails to Slow

Bloomberg, August 27, 2015

Coal may drop below US$50 a metric ton this year as a supply glut combines with a slide in emerging market currencies that supports exports …

“Demand is falling everywhere, yet production is still rising in a lot of places,” Thomas Pugh, an economist in London at Capital Economics Ltd., said by phone Aug. 20. “A lot of that is due to currency movement, due to the fall in oil prices, especially in places like Russia, Colombia, Australia.”

… Global coal prices “can probably go quite a lot lower,” Pugh said. “A lot of it is the downward pressure from a lack of demand in China, the U.S. and Europe. India’s the most recent one: everyone’s been banking on India to take up the slack and it appears they’re just not doing that.”

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