DAY 1
SESSION I
Introduction and the physical coal market
- Coal varieties and qualities
- Main steam coal producers, importers and exporters
- Steam coal physical flows and evolution
SESSION II
The steam coal derivatives market
- Main products traded: history, trading volumes
- Definition and methodology of main indices and futures
- Market structure: principals, brokers, exchanges
- New products recently launched
SESSION Ill
Coal derivatives trading examples
- Practical usage of derivatives for suppliers, end users, traders
- Trading strategies - Group Based Activity
DAY 2
SESSION I
Clearing and the coal market
- The credit crisis and the benefits of clearing for the coal market
- Cleared coal volume trends
- The clearing process and its participants: exchange, clearing house, clearing members
- How does an ICE cleared transaction differ from an OTC trade?
- Potential pitfalls to avoid
SESSION II
Forward curve and price forecast
- Difference between forward curve and price forecast
- The different shapes of forward curve: contango vs backwardation
- Historical coal forward curves and links with the physical market
- Trading the forward curve: Group Based Activity
SESSION III
Introduction to financial options in the coal market
- Status of the option market: historical volumes, types of options
- Example of call and put options
- Live demonstration of the Black Scholes model
- Application to the physical market
SESSION IV
Introduction to other commodities directly relevant to coal trading
- The physical dry freight market: vessel size, and pricing
- Main dry commodity flows: iron ore, coking coal, grains
- The financial freight market: indices and market structure (principals, brokers, exchanges).
- Emissions certificates, dark-spreads and spark-spread