Anglo American Plc · LSE:AAL
Anglo American — McCloskey Conference SA (January 2010)
14 slides from Anglo American's conference presentation, Jan 27, 2010
Slide 1: Changing dynamics in the world thermal coal industry
Changing dynamics in the world thermal coal industry Presentation at McCloskey Conference SA Norman Mbazima, CEO of Anglo Thermal Coal January 27, 2010 126340-25-Changing dynamics in world coal industry-v14-27Jan10-FK-MUN.ppt 0
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by Anglo American plc (“Anglo American”) and comprises the written materials/slides for a presentation concerning Anglo American. By attending this presentation and/or reviewing the slides you agree to be bound by the following conditions. This presenta
Slide 3: Overview & Objectives
Overview & Objectives Changing dynamics in the world coal industry: Will our experience of the last 10 years be an indicator of what is to come? How will thermal coal trade develop in the new decade? Key objectives for this presentation 1• The last ten years: Review the last decade of world's seabor
Slide 4: The last ten years: huge growth in thermal coal trade and production
1 The last ten years Huge growth in thermal coal trade as well as in coal productions World thermal coal production Seaborne thermal coal trade Bt Mt 6 800 +6% 600 +7% 4 400 2 200 0 0 00 01 02 03 04 05 06 07 08 09 00 01 02 03 04 05 06 07 08 09 CAGR World thermal coal production World seaborne therma
Slide 5: Seaborne thermal coal trade has shown increased price volatility
1 The last ten years Seaborne thermal coal trade has shown increased price volatility USD/mt Global seaborne volume Mt 800 200 700 600 150 500 400 100 300 200 50 100 0 0 '81 - '01 '02 - '07 '08 - '09 '10 - '13 Global Seaborne Volume MT API2 API2 forward curve API4 (FOB RBCT) API4 forward curve Sourc
Slide 6: Two major milestones influenced thermal coal in the last decade
1 The last ten years Two major milestones influenced thermal coal in the last decade Deregulation of European power market World financial crisis • Introduction of index pricing and the standard • Decrease in Global energy use in 2009 RB1 specification for South African coal • Major decline in impor
Slide 7: Focus of global thermal coal on the Pacific basin
2 Thermal coal at the end of the decade Focus of global thermal coal trade on the Pacific basin Russia 69Mt exports Europe 160Mt imports USA/Can. 22Mt imports N. East Asia China 221Mt imports 50Mt imports India 36 Mt 50Mt imports Minor trade flows Colombia Major trade flows Indonesia 65Mt exports 21
Slide 8: Different economic growth will further reflect on thermal coal
3 The next ten years Different economic growth will further reflect on thermal coal trade GDP growth for EU-27 GDP growth for China GDP growth in %, for EU-27 GDP growth in %, for China 10 10 5 5 10.5 10.9 10.4 9.3 8.4 7.6 2.5 3.0 2.8 4.0 3.8 2.0 0.8 1.9 0 0 1985 1990 1995 2000 2005 2010e 2015e 1985
Slide 9: But there are uncertainties in the development of demand
3 The next ten years But there are uncertainties in the development of demand ... India China • Record thermal coal imports of 50 Mt in 2009 (up • YTD Nov 2009 Chinese domestic coal production 15 Mt from 2008) was up 10.2% to 2.631 Bt • Total thermal coal demand is expected to double to • Yet record
Slide 10: ... as well as in the development of supply
3 The next ten years ... as well as in the development of supply China If there were an economic slowdown, Mozambique could China become USA a major exporter again? & Mongolia Will a weaker US Dollar Could these countries and the introduction of become major cap and trade CO2 exporters by the end of
Slide 11: Positive future of coal despite CO2 discussions and Climate Change
3 The next ten years Positive future of coal despite CO2 discussions and Climate Change • The Copenhagen meeting did not result in agreement on how the developed world should price the cost of carbon post the Kyoto Protocol • Current cost of EUA is ~ € 12 / t • In order to encourage investment in CO
Slide 12: How could thermal coal trade look in 2019?
3 The next ten years How could thermal coal trade look in 2019? Russia Europe USA Canada N. East China Asia ? India Colombia Indonesia South Major trade flows Africa Australia Importer ? Exporter Coal trade centered in Pacific Trend to lower CV coal production from ageing coal field will further fue
Slide 13: Summary
Summary The past decade has seen tremendous changes taking place in the thermal coal market and we expect the next ten years to offer similar levels of excitement However, it is easier to ask the questions than to find the answers Anglo is well prepared for changing dynamics in the world coal indust
Slide 14: Questions?
Questions? 126340-25-Changing dynamics in world coal industry-v14-27Jan10-FK-MUN.ppt 13
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