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Kallanish Kallanish

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February, 19th 2019

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FEB 13

Arch sees met coal retaining strength in 2018


US coal producer Arch Coal expects its metallurgical coal business to benefit from strong global prices throughout 2018, Kallanish learns from the company’s 2018 forecast.

Arch plans to sell about 6.4-7 million short tons of metallurgical coal in 2018, down from 8.2m st in 2017. Average cash costs will be $55.50-60.50/st, down from $60.76/st.

The company already has committed average metallurgical coal priced at $103.96/st. The average price for all metallurgical coals in 2017 was $90.17/st, with coking coal at $102.36/st.

“On the metallurgical side, Arch has committed select volumes at strong pricing with its North American customer base,” the company says. “Arch also has a large percentage of its 2018 coking coal either committed and subject to market pricing or still available, which will allow it to capitalise on strong seaborne coking coal market dynamics. At the expected midpoint of its volume guidance level, Arch is nearly 65% committed on coking coal sales for the full year, with approximately 60% of that committed volume exposed to market-based pricing. Arch expects that approximately 80% of its metallurgical production will be sold to international steelmakers.”