Nov 18, 2016 09:59:50

Coal: Asian thermal coal industry will likely remain under pressure in 2017

Fitch Ratings stated in an outlook report that the Asian thermal coal industry will remain under pressure in 2017 due to more-than-adequate capacity and price adjustments that are likely to be downward. The strong pricing rebound since early 2016 is unlikely to be sustained as the Chinese government relaxes its workingday curtailment policies to manage prices. Also, India has been ramping up domestic supply aggressively to enhance energy security and reduce current account deficits, while domestic demand growth has been lackluster. At this stage, Fitch expects Indonesian coal producers that focus on the export market are likely to suffer the most as India, their largest buyer, experiences weak thermal power generation, curbs coal imports and increases utilization of higher-rank Australian and South African coal. (Fitch)