Regional Coal: Macquarie note of seasonally weaker price period due to stronger production from Aus and Indo and lower demand due to Northern Hemisphere summer season seasonal weakness, but offset by re-emergence of China import arbitrage and increasing Indian interest…..
Reiterate view that we could see global thermal coal price remaining range-bound in the short term, and therefore prefer names that offer production growth such as SARs, PTBA and Shenhua. In medium term, continue to prefer Asean names given relatively low oil price exposure, high open-price exposure going into 2012, and attractive valuations (trading at 10x 2012E P/E vs Chinese at 11x).
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