Hi Dyer, excellent content, thanks for sharing. Regarding HCC, the reference price for them is the australian coking Coal Index? If so, there is a great upside in revenues next quarter vs estimates (around 190) vs a back of the envelope calculation (1800 Tones * 250 Austr price = 450) I am missing something? seems nuts!
Quite new to the space - how do we understand the forward profit margins of ~$100/ton? I gathered this is based on forward prices of ~190/ton vs cash costs of ~80/ton.
However, if I add Ocean Freight and Inland Logistics costs to the mining cash costs - that would imply a much smaller profit margin?
The netback is the price at the mine, so it's what the producer makes after transportation costs have been deducted. If netbacks are $190 and cash costs are $80, then profit margins are $110.
This is great stuff, thank you. Should we assume that every time we hear of a company shipping to China, it’s at least Panamax size? I believe Panamax was referenced for the last ARCH shipment into China
I think that's right. I don't think DTA (AMR & ARCH) is capable of handling Capesize so I'd assume Panamax. Not sure of the other coal terminals but probably the same story for the remaining met oriented terminals.
Hi Dyer, excellent content, thanks for sharing. Regarding HCC, the reference price for them is the australian coking Coal Index? If so, there is a great upside in revenues next quarter vs estimates (around 190) vs a back of the envelope calculation (1800 Tones * 250 Austr price = 450) I am missing something? seems nuts!
Why Cash Cost for HCC is only $65.28? Last quoters it was around $80.
They include transportation costs in their figure, so I estimated those expenses and removed it in order to normalize for cash mining costs.
Very interesting, thank you for sharing.
Quite new to the space - how do we understand the forward profit margins of ~$100/ton? I gathered this is based on forward prices of ~190/ton vs cash costs of ~80/ton.
However, if I add Ocean Freight and Inland Logistics costs to the mining cash costs - that would imply a much smaller profit margin?
The netback is the price at the mine, so it's what the producer makes after transportation costs have been deducted. If netbacks are $190 and cash costs are $80, then profit margins are $110.
This is great stuff, thank you. Should we assume that every time we hear of a company shipping to China, it’s at least Panamax size? I believe Panamax was referenced for the last ARCH shipment into China
I think that's right. I don't think DTA (AMR & ARCH) is capable of handling Capesize so I'd assume Panamax. Not sure of the other coal terminals but probably the same story for the remaining met oriented terminals.