Remember back in 2011 and 2012, when Washington University and Peabody Coal were telling us how the world, especially China, is going to keep consuming more and more coal? Didn't happen.
"It’s not just the direct impact of the current Chinese coal consumption slowdown on US coal production revenue that has American miners on the ropes. It’s the change in outlook for Chinese coal consumption going forward. Most of the US majors bet big on future Chinese coal demand growth at the top of the cycle in 2011. Arch Coal bought met producerInternational Coal Group for $3.4 billion that year. Alpha Natural Resources bought Massey for $7.1 billion in 2011 citing “a big opportunity to advance Alpha’s position as a premier supplier of metallurgical coal”. Walter Energy, which is an almost pure-play met company, doubled down on that strategy by purchasing Western Coal in Canada for $3.3 billion in 2010. CEO Joe Leonard described the deal as “a transformative transaction at a time when global demand for metallurgical coal is surging.” He continued, “our combined production capacity and geographic footprint leaves us extremely well positioned to benefit from favorable sector dynamics driven by increased steel production in markets such as China, India and Brazil.” All three companies filed for bankruptcy protection last year."
