Cost of coal production.
I'm in the gas industry and have a question for you coal guys. Some thermal coal prices has dropped 25% this year, being pushed down by the warmer weather, lower gas prices and a slowed down Chinese economy. The FOB Australia price was around $62/ton the other the day meaning that a large amount of the coal in the stack you sent is being sold at a loss.I'm wondering how low the price of coal before you would see more direct action such as mines shutting down. However I guess there are long term take or pay contracts etc prolonging these actions and I guess the mines can sell below marginal cost for a while, but after a certain amount of time some action must be taken. If you see a critical break even price for coal would be very nice.
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