Global coal consumption trends

Drive demand for coal machines

The growth of global coal consumption is mainly in Asia. Global coal consumption peaked in 2013, fell from 2014 to 2016, and again saw significant growth in 2017. Global coal trade increased again in 2016 and 2017 before it fell by more than 100 million tons in 2015.

In 2016, China ended its continued downward trend in coal prices since 2011. The price of thermal coal started to rise and exceeded 100 USD / ton. China ’s natural disasters and coal mine accidents since December 2015 have caused a tight balance between supply and demand, and the price of coking coal has risen to US $ 220 / ton.

The increase in the price of coal indicates an increase in the demand for coal. The increase in the demand for coal will also lead to an increase in coal mining volume and coal mining enterprises, thereby driving the demand for coal machinery and equipment.

Coal demand has been showing a downward trend before rising in 2017, and will continue to increase mainly in Asia in 2019, along with the expansion of coal imports. Although coal prices remain high, as the basic supply capacity of the coal market continues to increase and exceed demand, 2019 will show a downward trend.

China Coal Import

In short supply

Western countries coal

Impact of phasing out

With the withdrawal of investment and loans for coal mines and coal-fired generating units, and the suspension of insurance for these projects, foreign financial institutions, funds, Japanese banks, insurance companies, and trading companies are increasingly announcing the withdrawal of coal-related investment. Enterprises are often reluctant to develop new coal mines or coal-fired power plants, but focus on high-quality coal development and efficient coal-fired power generation.

With the high coal prices, the operating conditions of coal mining companies are very stable, and the pace of industry adjustment is slowing down.

Western countries ’coal phase-out will continue. In the context of growing energy demand, emerging countries are committed to expanding coal production and procurement, and developing coal mines and coal-fired power generation without relying on developed country finances.

The phasing out of coal will have limited impact on coal supply and demand and short-term prices. In the medium to long term, coal supply and demand may undergo structural changes.

2019 coal market

Situation summary

The demand for thermal coal in Asia and other emerging countries will expand. The growth of coal demand in Asia exceeds the decline in demand in other regions, and the global demand for thermal coal will increase slightly.

On the supply side, the adjustment of the coal industry has basically been completed. After idle coal mines resume production and expand coal mine operations, coal supply capacity has been maintained and will increase. It is expected that supply will exceed demand.

In 2019, the coal market is basically unlikely to have a tight balance between supply and demand. The prices of thermal coal and coking coal will remain high. If the supply and demand are exceeded , coal prices will fall in 2019.