Does anybody on here have experience with physical coal trading? Not seeing any recent info on the forums.
Currently interviewing for an trading analyst spot with one of the bigger global players--headhunter reached out via LinkedIn, so sort of random. Background: 2 yrs economic consulting experience dealing with energy market fundamentals (but mostly power/gas though). I've been thinking about making the transition to energy trading for a while now, but never put much thought into coal.
Seems like the spot market is getting volatile lately as well, so potential opportunities there.
Would definitely appreciate any insight.
I trade thermal coal - what sort of insight you looking for?
Thanks. Mostly curious about where you see the industry going, and whether you’d recommend it. Also what’s the day to day like?
FWIW, the group I’m interviewing with trades thermal and met, and almost exclusively deals with exports to Asia.
Coal is a dry bulk commodity which means shipping is a large component in the global coal trade. So I definitely recommend keeping track of the dry bulk freight market by reading the latest news on industry websites such as TradeWinds.
Coal is an interesting market. I am based in Europe, so I am only really aware of the big trading arms of utilities and major trading houses having a large hold of the market. It seems as though Glencore's is less dominant as they once were in Coal trade which probably a good thing for other players in the market - https://uk.reuters.com/article/uk-japan-glencore-thermal-coal-explainer…
Note that in Europe that a lot of the utilities are defossilising which means they are spinning off the coal assets into new companies.
Thanks, this is really informative, especially the shipping bit. I'm in the US and it's a similar situation; coal plants are just being economically retired due to cheap gas. A lot of the miners in the US are in trouble as well. Seems like Asia will the main source of demand pretty much forever.
Coal markets are tough, and adding value as a trader is getting thin and profit margins are getting slimmer day by day. There is a lot of transparency in the markets due to its concentrated size, and everyone knows who is offering what cargoes, and who holds which longs/shorts. The ones who are banking at the moment are the producers with the high metcoal and thermal pricing from Australia, South Africa, and to some extent Indonesia for some products.
I would suggest yes if you're joining a coal miner, less so if its a trading shop as it will depend on its size and volume. If you are looking for the big bucks I think that train has long gone for someone junior in the coal space.
I disagree to TensorField comment above about Glencore's less dominance. They are actually holding huge dominance.
I dont have a strict day-to-day, if I'm not travelling and meeting with counterparties I am usually speaking with them over the phone, or visiting mines, power utilities, coal consuming plants, loading/discharging of my vessels, etc.
Thanks for the insight, very informative. So I don’t want to publicly ID the firm but they aren’t a pure trading shop (they own some assets) and they move about 1/3 the volume of Glencore. And I would be based in US. They aren’t a miner though.
I’m making good money now, but just kind of bored in my current job and ready for a change. For me, the appeal of this role would be the international aspect and potential for travel.
What would you say exit opps / career progression would look like? Move on to a more prestigious shop (e.g. Glencore)?
Shoot me a PM if you want feedback on the firm. There's many players in the market who aren't pure trading shops that have some offtakes or pre-financing, but moving about 1/3 volume of Glencore there are only a few.
Spot exports to Asia from US is because the phys arb is open due to the big swing of coal prices from Richards Bay - mainly cargoes are flowing into India. You have some South Korean buyers taking from the US when freight differentials pop up from time to time, but this will be impacted by the recent import sulphur limits which means the natural source will be Australian.
Career progression from trading analyst > coal trader usually takes anywhere between 2-4 years assuming a spot becomes available. You can to an extent switch from coal to other resources such as iron ore, bauxite, etc depending how you market yourself - ideally you should be able to jump into any dry bulk commodity.
Coal is a different beast, and those prestigious shops that are traditionally in oil/metals could be considered small to mid-tier shops in the coal industry, with Glencore being the exception. Glencore hire young and mould/groom them into their ranks, or hire externally the traders with sizeable books.
Coking Coal Traders (Originally Posted: 02/10/2014)
This is kind of a long-shot but does anyone know who the big traders in coking coal are? I don't mean producers like BHP-Mitsubishi. Glencore, Noble, Oxbow?
Thinking you would probably only find utilities left trading coal, like American Electric Power. Most people moving to nat gas with the increasing coal regulation coming
COKING coal. And no, even when it comes to steam coal, Glencore, Cargill and the like trade a lot.
Salut :)
It's quite hard to get information on this market because most of transactions are OTC I guess(and maybe all of them). I'd say Glencore is the bigger one, but don't forget Vitol and Trafigura.
Look what I've found http://www.infomine.com/investment/coal/
It doesn't state the main traders but it's highly relevant as most of big traders have their own exploitation.
Hope this helps
PS: I haven't seen you were asking about cooking coal... it's even more opaque
Oxbox, AMCI, Metalloyd, Koch, Thysen Krupp (TK coke products or something like that), etc
tonixity, for steam coal this is a good overview: http://www.reuters.com/article/2009/05/19/coal-factbox-traders-idUSLI62998020090519
Thanks contagoman!
yoo, dont forget the actual users of petcoke.... look at heavy industry (steel, aluminium & cement !). Some even have their own trading/procurement teams.
And yes, the petcoke sector is quite opaque and most deals are done OTC. Even the major consumers of petcoke are not really happy about the way petcoke prices are disiminated. Basically the prices are not transparent at all and the consumers rely on the only available source: the pace index.
my 2 cents..
Additional homework below ;-)
http://www.cembureau.eu/newsroom/article/how-petcoke-market-functions-petroleum-coke-used-combustible-cement-kilns
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