Coal markets

June 2016

Gas continued to steal market share from coal in 2015, according to this year’s edition of the BP Statistical Review of World Energy, published in June. Global coal consumption fell by 1.8% in 2015, well below its 10-year average annual growth of 2.1%, while gas consumption grew by 1.7% – a significant increase from 2014 but still below the 10-year average of 2.3%.

BP said the drop in coal consumption was the largest since the company started publishing the review. Declines in the United States (12.7%) and China (1.5%) were partially offset by modest increases in India (4.8%) and Indonesia (15%). Global coal production fell by 4%, with large declines in the US (10.4%), Indonesia (14.4%) and China (2%).

Europe and Russia

  • Coal futures prices have continued to recover from their January lows. Richards Bay front-month futures have averaged $57.45 per ton so far in June, up by 6.8% from the May figure of $53.60/t. ARA coal prices averaged $51.05/t in June, which was a rise of 7.2% from the $47.80/t price in May. By contrast, Richards Bay and ARA prices had tumbled to annual lows of $49.25/t and $43.40/t respectively in January and February.
  • Ukraine is facing a shortage of coal from the Donbas region, with stocks at warehouses and power plants expected to decline. The region has not supplied coal to power plants since the start of June. Only half the deficit of high quality coal can be covered by imports, the country’s regulator said.

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