SunCoke Energy Inc
SunCoke’s financial position is better than others in the coal ETF
While SunCoke isn’t a coal producer in the strictest sense, it boasts one of the most prudently managed balance sheets in the VanEck Vectors Coal ETF (KOL).
SunCoke’s business model protects it from customer concentration risk
SunCoke’s business model includes entering into long-term take-or-pay contracts with customers, which protects it from a downturn in the steel industry.
SunCoke Energy’s customers: ArcelorMittal, AK Steel, and U.S. Steel
ArcelorMittal (MT) is SunCoke’s largest customer. It gets its entire coke supply from Suncoke’s Jewell coke plant in Virginia and its Indiana Harbor plant.
The international operations of SunCoke Energy
SunCoke started its coke making plant in Victoria, Brazil, in 2007. In March 2013, it formed a joint venture to run a coke making plant in India.
SunCoke Energy’s presence in the steelmaking process
Coke is used in the iron making process, which in turn is used in the steelmaking process. SunCoke Energy produced 4.2 million tons of coke in 2013.
How does coke fit into the steelmaking process?
Iron ore, steel scrap, and met coal are the main raw materials for steelmaking. SunCoke converts met coal to coke by driving out its impurities.
A quick look at SunCoke Energy’s US operations
SunCoke Energy (SXC) is the largest independent manufacturer of coke, which is used in steelmaking. It runs five coke making plants in the United States.
SunCoke Energy fares better than its peers
It was a tough year in 2014 for American companies under the VanEck Vectors Coal ETF (KOL). SunCoke Energy (SXC) managed to limit the fall to 21%.