Apparently, the Queen thinks Scomo is somewhat of a dill*. It appears HRH is not the only one if you look at some of the Twitter hash tags associated with our current Prime Minister. Everyone is entitled to their opinion, form your own.
Morrison in his former role as Treasurer did famously (or possible infamously) bring a lump of coal into the House of Representatives stating, “this is coal, don’t be afraid, don’t be scared”. He is correct coal is beautiful, it is inexpensive, relatively inert, it has a low transportation risk, and it largely powered the industrial revolution. Problem is, coal, along with other fossil fuels are the primary source of climate change**. Again, everyone is entitled to their opinion, form your own.
Well, that was a major digression. On to Whitehaven. I was asked about this by a colleague around Christmas in 2015. He reminded me about it the next Christmas. Glad he left so I didn’t have to hear about “how much I cost him” again in 2018. Meh, DYOR and everyone is entitled to their opinion, form your own.
For those still reading, how did we get here and why is this even being written. Well, there was an auzbiz report from Daviet Huynh, Equities Analyst at Shares in Value. He claims that the coal price rally isn’t ending anytime soon, and Whitehaven Coal is Australia’s leading producer of premium thermal and metallurgical coal and has five mines throughout New South Wales. No dispute from me on the latter point.
Huynh*** then goes on to state Whitehaven’s major export markets are Japan, Taiwan, Korea, and India. This is also not disputed with a BIG caveat. Japan is currently Australia’s largest coal market and now the caveat, the Japanese government have stated they will consume zero coal from 2030. That is only 9 years away, and they are not going to continue to consume the same volume until 2030, coal is going away in Japan, and soon.
Back to Scomo, despite what he is telling us, coal under duress in Australia too. Aside from one small generator in WA, the two youngest power stations in Australia are in Queensland and these, along with all coal power stations are now or will be soon beyond their design life. Renewables (and natural gas) are taking over the generation mix.
Stating the obvious, coal miners are price takers. The Whitehaven share price is reasonably representative of the price of coal, although somewhat behind in the current coal price rally.
Not one for my book, however, everyone is entitled to their opinion, form your own.
*not factual, extrapolation of comments made regarding attendees at Glasgow Climate Summit
**For this one, I’m siding with science.
***Not dissing the fella, just difference of opinion
