Coal shortages increase prices, weigh on economies

Coal shortages are challenging to keep oil prices high and to free the world economy from one of the most important and destructive sources of energy.

There are many reasons for the boldness: from a post-epidemic boom to supply chain types and high power goals to reduce carbon emissions. And in the coming months, oil shortages in many countries are expected to increase, at least until the winter.

Australia’s Newcastle coal, international standards, tripled by $ 202 per metric tonne by the end of 2019. Coal produces about 40% of the world’s electricity and is about 5% less than pre-epidemic. Stages.

Rising prices for coal and other energy resources in Europe have hit factory production and raised household energy costs. Major coal importers in Asia, including Japan and South Korea, are rushing to protect supplies.

The declining supply and supply costs in China have led to an unprecedented shortage of electricity for more than a decade, hitting industry and turning off some traffic lights to save energy.

The United Nations Climate Summit in Glasgow is a reminder of how large parts of the world can rely on coal to accelerate the transition from fossil fuels to renewable energy.

Oops, Progressives is pushing for a new green movement with more legislation.

China, the world’s second-largest economy and the largest consumer of coal, is currently in crisis. When Beijing tried to achieve its climate goal, it allowed coal production to decrease. He also stopped importing Australian coal into a diplomatic dispute.

As a result of last year’s decision, China is still hunting for alternative suppliers to Latin America, Africa and Europe, re-establishing international coal supply chains and attracting new buyers to Australia.

Globally, coal supply does not keep pace with demand for global economic recovery. Production fell by about 5% from 2019 last year. And it will take time to accelerate production, say coal producers. They say it could take up to nine months to install new equipment and even longer.

“We have grown in capacity,” said Isidro Konsunji, chairman of the Philippine Mining and Power Corporation of the Philippines, which exports most of its exports to China. Coal prices have quadrupled over the past year. I don’t think anyone in the world would expect such a thing.

Analysts say that the world’s dependence on coal has led to economic growth rather than government climate change. At the time of the outbreak, global coal consumption declined last year but is expected to meet or exceed 2019 standards this year.

“When economic growth stumbles, demand for coal decreases and everyone thinks we are moving away from coal, but as growth returns, coal consumption will accelerate again,” said energy analyst Wood McKenzie. “There is a difference between what people are doing in the transfer of power and what is really happening.

When countries try to hit emission targets, the supply of coal is partly due to production delays. Last year, for example, Spain shut down half of its coal production and promised to completely eliminate all coal-fired power plants by 2030.

According to the Paris-based International Energy Agency, the unrest in the sector will prolong decades of coal-fired trade.

The rise in Asia will help push prices. One-third to one-half of Australia, the world’s largest coal exporter, traveled to China before Beijing, calling for an independent inquiry into the origins of Vin-19, and imposed an unofficial ban last fall.

For other Asian economies, Australia’s sudden supply is a blessing. A.D. As China’s coal reserves fell in early 2020, Australia’s coal demand rose by 56% in the first half of 2021 and by 65% ​​in Japan in the first half of the year, according to official data.

Australia’s exports are still unlikely to close the gap between global demand, winter storage and edge-supply. Analysts estimate that global coal will grow by 2.5% this year, but demand could double that pace.

India’s Australian steel, imported in July, has been expanding since the beginning of the year, although supply is still short.

A spokesman for the Nippon Steel Corporation in Japan said Australia’s cocoa imports were boosting when the demand for steel returned to normal after the outbreak.

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A spokesman for Japan’s largest power plant, Jera, which is expected to fail this summer at some power plants, has prompted earlier plant inspections to ensure adequate electricity supply, a spokesman said.

In recent years, Australia has produced an average of 85 million metric tons of coal per year, more than Canada’s annual production. To compensate for this shortcoming, China has hit near and far – in some cases more than twice as much as Australia. During the first eight months, imports of coal from Russia doubled to about 21 million metric tons a year. Coal has quadrupled from the United States to 5.7 million tons.

Asian suppliers have moved to Australia to replace Chinese-bound volumes. Philippine producer Samirara, on the other hand, saw coal prices rise 49% in the first half of this year, when China’s demand was high. The company is trying to increase its capacity to meet high demand.

Attempts by China to find new rulers have failed. As Beijing’s fortification with Canberra intensifies, the Chinese have tried to block Indonesian coal purchases, with many of the lower levels fleeing international markets. However, heavy rains have disrupted supply. Indonesia’s coal exports to China fell by 8.6% in August, following similar decline in January, April and May, according to official data.

Colombia and Kazakhstan are among the most predictable. Before this year, the Latin American people were only occasionally a source of inspiration for China. Colombia’s coal exports to China doubled to 2.8 million metric tons a year ago. China’s share of Colombian iron ore shipments increased by 0.6% to 21% in 2019.

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The Colombian Ministry of Mines and Energy estimates that coal production will increase by 50% by 2020 this year. For his part, Juan Miguel Duran, president of the Colombian National Mining Association, said the South American nation could be hit by a hurricane. It is beyond the scope of the epidemic to reverse the global economic demand for green energy. He said Colombian coal production is attracting demand from Chinese, Indian, Japanese and Korean investors.

“We are in a window of opportunity to exploit and expand our mineral potential,” Mr Duran said.

In late August, Colombia, the country’s fourth-largest producer of natural resources, revived processing facilities closed last year due to low prices and the epidemic. But to increase supply, replacement equipment will need space for at least six months to a year, said Samirara Mr Konsuji.

“Last year prices were so bad, no one could make money, so we stopped buying more spare parts,” said Mr Consuji. However, there will be a delay before the supply arrives again.

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