As of quite recently I am long EXP, AMR, and HCC (still building up that position). Really enjoyed your write up on NRP, but didn't feel like dealing with the K-1 form as my tax situation is already somewhat complicated. I think the long term case for Met-Coal appeals to me more than that of thermal coal.
While thermal coal has some unique physical properties that have made it a fundamentally important source of energy in the world, the net product of thermal coal is still just that; energy. For me anyway, building a viewpoint on thermal coal vs natural gas or nuclear energy as a source of base load power was too difficult.
Met-coal, on the other hand, is the only real game in town when it comes to virgin steel production. Hydrogen steel production is a WAYS away from feasible in the West and that is even truer in markets like China and India where steel production (therefore met coal supply) is intrinsically linked to growth and development. The recycling of steel in EAF's (electric arc furnaces) has been a major disruptor for domestic virgin steel production in the US. There is one core issue here, however, which is that much of that recycled steel has been employed in long lasting infrastructure projects which will keep that steel buried in concrete (shout out Eagle Materials) for half a century or more. There are also some real limitations on the use cases for recycled steel. If you want to build a bridge, tunnel, or high-rise building you need a lot virgin steel for structural support. Re-enforcing concrete with re-bar, however, can be done with recycled steel. I think the real case for AMR and HCC comes from Indian demand for virgin steel. China may re-bound, but an over built housing sector is a structural (pun intended) problem for steel demand (imho). I took my position within the last 2 weeks as stock prices for AMR and HCC (those two pure play met coal companies i mentioned earlier) continue to plummet from their highs. No idea if the bottom is in on met coal. Might be a bumpy ride. Anyway, i would LOVE a deeper dive and your view on these two companies. I have a lot of my own research, but its largely un-audited and my capacity to be wrong is vast.
As of quite recently I am long EXP, AMR, and HCC (still building up that position). Really enjoyed your write up on NRP, but didn't feel like dealing with the K-1 form as my tax situation is already somewhat complicated. I think the long term case for Met-Coal appeals to me more than that of thermal coal.
While thermal coal has some unique physical properties that have made it a fundamentally important source of energy in the world, the net product of thermal coal is still just that; energy. For me anyway, building a viewpoint on thermal coal vs natural gas or nuclear energy as a source of base load power was too difficult.
Met-coal, on the other hand, is the only real game in town when it comes to virgin steel production. Hydrogen steel production is a WAYS away from feasible in the West and that is even truer in markets like China and India where steel production (therefore met coal supply) is intrinsically linked to growth and development. The recycling of steel in EAF's (electric arc furnaces) has been a major disruptor for domestic virgin steel production in the US. There is one core issue here, however, which is that much of that recycled steel has been employed in long lasting infrastructure projects which will keep that steel buried in concrete (shout out Eagle Materials) for half a century or more. There are also some real limitations on the use cases for recycled steel. If you want to build a bridge, tunnel, or high-rise building you need a lot virgin steel for structural support. Re-enforcing concrete with re-bar, however, can be done with recycled steel. I think the real case for AMR and HCC comes from Indian demand for virgin steel. China may re-bound, but an over built housing sector is a structural (pun intended) problem for steel demand (imho). I took my position within the last 2 weeks as stock prices for AMR and HCC (those two pure play met coal companies i mentioned earlier) continue to plummet from their highs. No idea if the bottom is in on met coal. Might be a bumpy ride. Anyway, i would LOVE a deeper dive and your view on these two companies. I have a lot of my own research, but its largely un-audited and my capacity to be wrong is vast.