** Jefferies says coal markets remain governed by demand and not cost curves, with coal producers Whitehaven Coal WHC.AX and New Hope NHC.AX being 'well-positioned'

** Adds inflexible Australian supply and adaptable cost structures have dampened the supply response

** Prices remain range-bound despite seasonal volatility, with margin performance now dependent on operational, cost, and capital flexibility - Jefferies

** Says, in the current environment, producers with low-cost assets, strong balance sheets, and leverage to demand are poised to outperform

** Favors NHC as a thermal outplay due to its cost curve position and robust balance sheet, supporting counter-cyclical strategy and M&A prospects

** YTD, NHC and WHC are both down 20.4% and 6.1% respectively

(Reporting by Kumar Tanishk in Bengaluru, editing by Deepa Babington)

((Tanishk.Kumar@thomsonreuters.com; X: @thatstanishk http://www.x.com/thatstanishk;))