The rumors of coal’s death have been greatly exaggerated. That applies in every sense - the commodity’s price, the underlying stocks, and even coal’s place within the global energy machine. Coal’s not going anywhere, and like oil once was, coal could actually be a brilliant long-term idea.

Admittedly, part of the reason I’m now interested enough to bring it up is our recent profile of China Energy Recovery (CGYV). By prepping our coverage of the company, I learned quite a bit about how coal is used for energy creation by prepping our coverage of the company. Along the way though, it also became clear we don’t have a lot of choice in the matter - we need coal if we’re going to meet our growing energy demands. The fact that China Energy Recovery makes using coal cleaner and cheaper is just icing on the cake.

Anyway, given that so many coal stocks were so rewarding in the early part of 2008 - and so destructive in the latter part of 2008 - I think there’s enough of a reason to start looking at the commodity and the trading opportunities it presents. (Or, maybe I’m just tired of talking about oil.)

Here’s a chart of the spot prices for Appalachian coal, which is generally the standard for the coal commodity market. There are other types of coal, but they’re of lesser quality/heat yield. Any of the charts would work, as they all tend to move in unison. The Appalachian coal price seems to be the focal point though.

What’s interesting is how the underlying stocks in the coal industry trade in tandem with coal prices, much like oil stocks do with oil prices. The cool part about coal, however, is that it’s not exactly synchronized with oil. Sometimes, it’s totally disconnected from oil.

I just wanted to officially launch our newest addition to the laboratory/research arena. I’ll be adding forecasts and additional thoughts soon, because I really think coal’s going to become the next oil in the foreseeable future. That’s not to say alternative energies won’t eventually take over, but that’s decades down the road. Coal’s going to have to fill the gap.

Any thoughts? Leave ‘em below. Let me know what’s on your mind when it comes to our newest topic.

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