Mineral-energy-international.com, In 2023, global demand for coal increased by eight percent, but changing conditions and unpredictable weather create uncertainty for the coal market. According to the Federal Government’s ‘Resources and Energy Quarterly’ (REQ) report for March 2024, coal was Australia’s largest export, totaling around 170 million tonnes. This growth is significant for Australia, as demand for metallurgical coal is expected to rise from 317 million tonnes in 2023 to 331 million tonnes by 2029.
World steel production is projected to grow by 1.5 percent annually through 2029, which supports the continued use of metallurgical coal. The report highlights that several Asian countries are working on ambitious steel production plans, likely boosting coal demand. While the Chinese government has imposed a three percent import tariff on metallurgical coal, Australia is exempt due to Free Trade Agreements. However, the report suggests that China’s demand for coal may be reaching its peak.
On the other hand, India’s coal imports rose by 25 percent to 73 million tonnes in 2023, with continued growth expected. In terms of pricing, Australian prime hard coking coal averaged $US294 per tonne in 2023, down from $US360 per tonne in 2022. The REQ predicts prices will be volatile due to supply chain issues and weather events, forecasting an average price of $US277 per tonne in 2024.
The potential for a new La Niña cycle could contribute to further price fluctuations, with projections suggesting prices may fall to around $US185 per tonne by 2029. Despite these challenges, the REQ maintains a positive outlook, expecting Australian coal export volumes to increase from 161 million tonnes in 2023–24 to 175 million tonnes by 2028–29.
Overall, Australia is well-positioned to continue dominating the global coal market in the coming years, supported by expanding mining operations and steady demand from countries like India.
source: https://www.australianmining.com.au/