Matt Insley

“I’m about to blow your mind…” I warned Addison Wiggin, Agora Financial’s executive publisher.

I had just found out a stunning fact about U.S. energy – and couldn’t help but share it when Addison walked past my desk.

Today I want to share the same info with you – and although you may not have the same affinity for this information, there’s a profitable twist that I’m sure you’ll like….

First, let’s recap what we covered yesterday…

With the bad news that’s been flooding the coal industry over the past few years, sentiment in the market for U.S. coal producers couldn’t be worse.

Point is, there’s a stunning “buy low” opportunity in U.S. coal producers. There’s a lot of reason to like coal right now, too.

You see, although coal use in the U.S. may be gearing down, the rest of the world is ratcheting up.

As we covered yesterday, coal is easy to transport. So while the U.S. begins using more natural gas (from booming shale fields), more seaborne coal will head to Europe and Asian markets.

Here’s the kicker, burning coal is still a fraction of the cost of renewable energy. So if debt-stricken Europe and energy-hungry Asia want to keep the lights on, increasingly they’ll be turning to king coal. That bodes well for the U.S. export numbers.

And you won’t believe where that coal is coming from…

The Answer Was Hiding Within A Stone’s Throw From My Office!

Getting back to my conversation with Addison, “Here’s a little resource trivia for you…” I commented to him.

“The No. #1 exporter…. of U.S. coal…. to Asia…Is…..”

Drumroll please…. Baltimore, Maryland!

Whaaaaaaaaat!?!? Who’da known! When I first found out that little tidbit my mind started spinning. I instantly wanted to know how this was possible. My hometown of Baltimore couldn’t possibly be the biggest supplier of coal to Asia, could it? Where was all of this coal hidden?

In plain sight, take a look…

According to the U.S. Energy Information Administration, “Exports to Asia originate mostly from the East Coast […] primarily out of Baltimore. Somewhat counter intuitively, most coal out of Baltimore — almost double the port’s European volume—is destined for Asia, the world’s largest coal consuming region.”

As I said above, if you’re not from Baltimore you may not have the same affinity for this wild information. But the coal trail leads us to one company that you’ll want to add on your radar.

And as you’ll see, it’s not just this company’s affiliation to Baltimore that could set it apart in the coal game…

One Way To Play Coal’s Rebound…

The owner of the Baltimore coal-exporting facility pictured above is Consol Energy (CNX.)

Consol is in the sweet spot of this energy situation. Once a primary coal supplier in the U.S., Consol is now a hybrid company that produces natural gas (from shale) and exports loads of coal to Asian markets.

The Asian exports come from its wholly-owned Baltimore export facility, which is set for a handsome upgrade this quarter. Consol plans to increase the facility’s capacity from 14 million tons per year to 16, all in an effort to accommodate a growing world market.

If you’re wondering, the seaborne coal hits the Atlantic and heads east. The majority then travels south, below the tip of South Africa, and eventually ends up in India, China or other Asian locales. U.S. coal, headed east…that’s the trend.

And did I mention the stock is on sale? Since its 5-year high near $70, Consol’s shareprice sits at just half that price today. With continued strength in the global coal market, Consol’s East Coast facility could be the harbinger of a substantial payout.

But don’t just take my word for it. With Consol, there are a lot bigger names on board, one of which I’m sure you’re familiar…

Legendary oilman T. Boone Pickens just added Consol to his BP Capital fund in the third quarter. Pickens played Consol before for a timing trade, so when it comes to timing this energy player he knows a thing or two. Right now you can get in right alongside him.

Add it all up and the next 12 months could be turnaround time for U.S. coal. And with more output headed to Asia, Consol could be the darling of the bunch.

Keep your boots muddy,

Matt Insley

Original article posted on Daily Resource Hunter

Matt Insley

Matt Insley is the managing editor of The Daily Resource Hunter and now the co-editor of Real Wealth Trader and Outstanding Investments. Matt is the Agora Financial in-house specialist on commodities and natural resources. He holds a degree from the University of Maryland with a double major in Business and Environmental Economics. Although always familiar with the financial markets, his main area of expertise stems from his background in the Agricultural and Natural Resources (AGNR) department. Over the past years he's stayed well ahead of the curve with forward thinking ideas in both resource stocks and hard commodities. Insley's commentary has been featured by MarketWatch.

Recent Articles

It’s Time to Buy Microcaps for Double-digit Gains

Greg Guenthner

Yup, small-caps are setting up for a comeback year. In fact, I believe they'll retake a leadership role in the markets in 2015. So now's your chance to set yourself up for potentially massive gains before these stocks start grabbing headlines again. Or... you can simply wait until some ex-purt on CNBC or Fox recommends them - and miss out on half the party. Your choice...


Can Money Printing Cause Deflation?

Marc Faber

"There has been an issue that has preoccupied my mind for a long time," writes Dr. Marc Faber. "In economics, it is generally accepted that if the quantity of money and credit is increased, prices will rise… However, since economics is so complex… I question whether the expansion of central banks' balance sheets and policies of zero interest rates could have a deflationary impact…" The good doctor wrestles with the question, in today's essay...


How Low Will Oil Go – And What Can You Do?

Matt Insley

The oil market has been under siege for six months. From service providers to producers this downturn has been painful. Of course, we’ve known all along that oil prices were a little toppy over the summer. In fact, when asked just how low oil prices could go I usually answered with a simple “lower than you’d expect…”


Cuba’s Berlin Wall Moment

Peter Coyne

Our forecast that Cuba would be open and integrated within 5-10 years is on track after yesterday's big announcement. Ahead of schedule, even. Click here to see how some investors have profited and what the island's likely future is...


The $4 LED Trend You Don’t Want to Miss

Chris Mayer

The opportunity to sell and install LEDs is enormous. We’re talking about over a billion lighting fixtures. And the areas with the largest potential -- like parking lots -- have barely begun to change. Banker to the presidents Chris Mayer says you could triple your money in this new tech trend. Here's what you need to know.


Forget the Oil Crash – Crush the Market With Biotech Stocks

Greg Guenthner

The Biotech iShares ETF is up 23% since the Oct. 15th bottom. No, that is not a typo. Biotechs have torched the S&P over the past two months--more than doubling the returns of the big index. And biotechs as a group are up more than 38% year-to-date. In fact, since we first highlighted the June comeback, the Biotech iShares have gone nowhere but up.


How to Make the Casinos Pay You for a Change

Greg Guenthner

It's a theme we've shared with you since April. And it's only gotten worse. The gaming industry has come under all sorts of pressure--a situation I first noticed in the charts. The powerful, multi-year uptrends started showing cracks. And it wasn't long before those cracks turned into gaping holes you could drive a friggin' truck through. That's where things stand today.