US-based Peabody Energy has announced that metallurgical coal fundamentals are expected to improve as global metallurgical coal production cuts will be realized over the next two quarters.
Regarding metallurgical coal fundamentals, the company said that it is encouraged by recent stimulus measures and steel production in China. Following a weaker August, in early September China steel production is up more than seven percent. In addition, announced global metallurgical coal production reductions are continuing.
Peabody has raised its estimate of industry production reductions; approximately 25 to 30 million mt of metallurgical coal reductions have been announced in 2014, representing nearly 10 percent of the seaborne supply. In July, the production reductions were estimated at 20 million mt.