xanadu coal, page-32

XAM
HUN
AKM

Plus any other coal junior or major is well placed to rise in 2011 due to the positive sentiment and record prices for coking and thermal coal.

In the fin today is an article sourced from Bloomberg that slates coal imports to China may jump as much as 60% in 2011 due to strong demand from power plants (thermal coal is what is used in power generation----> XAM and HUN have in abundance).

Article states coal imports rose by 38% in 2010. This to a country that was consuming coal at a rate of 3:1 compared to the US before 2010. I can only assume it's higher than that after 2010.

A quote from the HK based analyst " we see increased supplies from countires, especially Mongolia"

Article also states that govt data on China's coal imports from Mongolia show it more than doubled in tonnes in the first 10 months of 2010.

They also go on to mention that the largest power distributor in China (there are two) shut down power generation units with a combined capacity of 5.23 million kilowatts because of.......a shortage of coal.

this is not the first article/ discussion paper i have read suggesting thermal coal demand will keep rising from China.

What does this mean......it makes smaller players like Hunnu (very early production opportunities) and XAM very attractive medium to long term prospects. It also makes them very attractive for the larger players who already supply thermal coal to China from Mongolia.

i have been topping up my HUNNU atm given the price weakness, and expect XAM and AKM to perform strongly in 2011 on the back of this sentiment.