Rejected 82%

Moranbah vs Port Hedland?

Some things to consider:
– Outlook for iron ore vs Premium Coking Coal
– China’s peak in it’s steel making intensity vs. India rapidly emerging
– FIFO practices emerging in Moranbah, Camp approvals
– Approvals for new projects in surrounding region

It seems the commodities analysts & major mining companies are generally much more bullish on a sustained shortfall of premium hard coking coal (as opposed to iron ore). One important trend to understand is that as China/India strive for efficiencies in steelmaking, they are building larger, modern integrated steel mills, and these require higher grades of coking coal. The exact same coal that surrounds the towns of Moranbah & Dysart. If you look at the coking coal projects either under consideration or in progress, you will see that geographically they are centered on Moranbah/Dyasrt, and this is why the medium term prospects are very good. Threats are Mozambique & Mongolia, but both suffer infrastructure deficiencies, and will take time.

Iron ore on the other is a relatively common mineral, with many deposits. There is a supply shortage generally, but analysts expect this to ease in the coming years, potentially cooling the Pilbara property market (??)

Another consideration – Port Hedland rental yield ~10%, Moranbah ~15%. This means greater potential for future capital gain in Moranbah.

Wondoan – Pure speculation. Yes there is a deposit, and Xstrata have been promising to develop for years. Now they have sold off a stake, and there is some analyst speculation of further delays.