Coal prices show China's desire to reform as companies collapse – ValueWalk Premium

Coal prices show China's desire to reform as companies collapse

The most exciting story in the commodities market this year has been coal. Thermal coal prices have risen by a sharp 40% in the past three months alone while coking coal prices are up almost 130%.

For such a bland, boring commodity, which most analysts believe is on the way out as cleaner burning fuels replace coal as a primary energy source, this price spike is extraordinary. However, unlike the last time we saw this sort of jump (back in 2009/10) it is not a strong demand story. Instead, it is in response to Chinese policy . . .

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