target $7.75, page-33

re: market forgiveness? Not forgiveness, but market focusing on new coal contract prices for April 1 and thermal contracts look like $47 at the moment which it above expectation. However bearish mood could return at any time, so be prepared.
As far as cost blowouts are concerned, this does not apply to cheaper countries like Indonesia or China for that matter. No comparison with an Australian miner earning 120k pa Vs $2/ day for a Chinese worker doing the same job. Cost of rail / port construction far too disjointed and inefficient also compared with China. We will need to focus on the coking coal aspect in future as thermal coal will be unprofitable. Many of the mines in the US simply cannot compete below a price of $45.