No Headwinds for Coal ... at All

[phantom power]

Growth industry.

If you can find a reason not to be invested in the coal sector, please page me now. Blow up my hip or whatever. Because outside of a straight ban on huge swaths of existing mining, there is nothing ready to stop this train.

Every day, another company announces another blowout quarter. This week it was Alpha Natural Resources, the Virginia-based concern that operates mines here and in surrounding states. It is one of the most levered to the price and demand for metallurgical coals, and it reported selling recent tonnage in the ballpark of $250. Prices in Asia have seen highs of $305 a ton or more in the most recent settlements.

The good news for all in the space is that the investment analysts are catching up to the view that met coal will stay above $200 at minimum in 2009 and possibly beyond.

All local miners are talking expansion and adding new workers. The conference calls have been most interesting, with Alpha officials essentially telling analysts that the labor situation is as tight as the recent 2005 peak. Everyone who can pass a drug test and wants to work is working.

http://www.statejournal.com/story.cfm?func=viewstory&storyid=38327&catid=159

[On the Road]

1. Just Noticed This This Morning:

Coal is at the top of Clearstations Hot Industries list:

	               5-day%	13-wk %
Industry:	       Change	Change
Coal	                9.87%	35.83%
Non-Metallic Mining     7.99%	42.85%
Iron & Steel          	5.52%	44.23%
B'casting & Cable TV	5.13%	8.81%
Tires	                5.10%	13.91%
Oil & Gas Operations	4.63%	34.22%
Office Equipment	4.35%	4.29%
Water Transportation	4.09%	21.43%
Consumer Financial Svc	3.87%	0.48%
---snip
Crops	               -3.38%	-2.17%
Water Utilities        -3.66%	-4.78%
Airline	               -4.75%	-20.93%
Photography	       -8.31%	-11.55%
Mobile Homes & RVs     -10.97%	-16.48%

Ordinarily, I don't like to invest after a big rally, and coal is not the most environmentally friendly thing to put your money in. But there might indeed be a lot more to go.

[phantom power]

2. When push comes to shove...

I'm pretty sure the world is going to turn to coal like Faust on a fucking crack binge.

[kristopher]

3. Two parts of the problem.

Last year the financing for new coal plants disappeared. They have essentially stopped building them

Why?

Because the price of the fuel is getting ready to take a large hit. We may not b able to capture carbon from the air, but we certianly can and will capture the price of putting carbon into the air.

Unless you think climate change is bullshit, I'd recommend investing in the renewable sector - especially solar or wind.

[Canuckistanian]

4. Coal is FAR too seductive

Relatively cheap extraction costs, existing facilities to burn it, CENTURIES of reserves.

It's a recipe for disaster.