outlook and challenges for international coal …china saw decreases in both 2014 and 2015,...

Outlook and Challenges for International Coal Market in 2020

The Institute of Energy Economics, Japan

Coal Group, Fossil Energies & International Cooperation UnitAtsuo Sagawa

23 December 2019The 434th Forum on Research Works

IEEJ：February 2020 © IEEJ2020

IEEJ

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1

Points of the Report

An increase in world coal consumption and imports is expectedin 2020, primarily centered around India, ASEAN nations, andAsia.

There were large decreases in spot coal prices during 2019 forboth steam coal and coking coal. This levelled out, beforetrending slowly upwards. At present: Spot steam coal prices (FOB price at Newcastle Port,

Australia) were around $67/ton Spot coking coal prices (Australian premium hard coking

coal FOB price) were around $135/ton Spot steam coal prices for 2020 are forecast to fluctuate at

around $70/ton due to seasonal factors, with spot coking coalprices expected to be between $140 - $150/ton


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Global Coal Consumption Trends

2

Global coal consumption increased again from 2017 onwards. This is largely centered around the Asia Pacific, with OECD Europe and North

America seeing ongoing declines. An increase in coal consumption amounts is expected in 2020, primarily centered

around India, ASEAN nations, and Asia.

2.2%2.8%

7.7% 7.3%

5.9% 5.6%5.0%

2.1%1.0%

6.5%5.2%

2.0%

1.3%

-0.9%

-2.7%-2.5%

1.7%1.1%

-4%

-2%

0%

2%

4%

6%

8%

10%

12%

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

'01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18

（百万t）

中東・アフリカ

中南米

北米

非OECD欧州･ﾕｰﾗｼｱ

OECD欧州

アジア・太平洋

総消費量の対前年伸び率

Note: Data for 2018 is preliminarySource: IEA Coal Information 2019

Trends in Per-Region Coal Consumption Amounts

Millions of Tons

Rate of growth of total consumption over previous year

Middle East/Africa

Central and South America

North America

Non-OECD Europe/Eurasia

OECD Europe

Asia/Pactific


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Global Coal Trade

3

Global coal trade decreased sharply in 2015, before increasing once more. Steam coal saw a gradual increase, with coking coal increasing until 2017, before

becoming flat in 2018. Although growth rates went down in 2019, an increase is forecast for coal trade

in 2020 for both steam and coking coal.

Note: Data on import trading amounts for 2018 is preliminarySource: IEA Coal Information 2019

5.9%

3.6%

6.5%8.0%

2.8%

8.1%5.4%

2.1%

2.1%

14.6%

7.3%

10.2%

6.2%

1.5%

-8.9%

4.0%4.7%3.6%

-15.0%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

0

200

400

600

800

1,000

1,200

1,400

1,600

'01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18*

（百万t）

一般炭

原料炭

無煙炭

褐炭

対前年伸び率

Trends in Coal Trading Amounts Per-Type

Millions of Tons

Rate of growth over previous year

Steam Coal

Coking Coal

Anthracite

Lignite


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Trends in Steam Coal Prices

4

Spot steam coal prices hit a peak of $123/ton in July 2018 but fell to $62/ton inAugust 2019.

This was followed by a gradual rise, with current prices at around $67/ton.Demand due to the winter seasons is likely to cause a further gradual rise.

Trends in Spot Steam Coal Prices (FOB price at Newcastle Port, Australia)

Source: globalCOAL

0

20

40

60

80

100

120

140

160

Jan-

10Ju

l-10

Jan-

11Ju

l-11

Jan-

12Ju

l-12

Jan-

13Ju

l-13

Jan-

14Ju

l-14

Jan-

15Ju

l-15

Jan-

16Ju

l-16

Jan-

17Ju

l-17

Jan-

18Ju

l-18

Jan-

19Ju

l-19

(US$/t)

50

60

70

80

90

100

110

120

130

Jan-

18

Feb-

18M

ar-1

8

Apr

-18

May

-18

Jun-

18

Jul-1

8

Aug

-18

Sep

-18

Oct

-18

Nov

-18

Dec

-18

Jan-

19

Feb-

19M

ar-1

9

Apr

-19

May

-19

Jun-

19

Jul-1

9

Aug

-19

Sep

-19

Oct

-19

Nov

-19

Dec

-19

(US$/t)


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Steam Coal Imports by Major Import Countries (Regions)

5

China: Saw another increase from 2016 (left chart). This was followed by a reduced rateof increase from 2019 (right chart).

India: Increased by 22.6 million tons in 2018, with increases continuing in 2019. Korea: Increased by 16.5 million tons in 2017 but decreased in 2019. Japan: Imported a record amount of 114 million tons in 2017, but this decreased in 2019. ASEAN nations have seen increases of over 10 million tons every year since 2016. This

increase continued in 2019. By comparison, amounts have declined in the EU since 2013. This decrease continued in

2019.

Note: ASEAN Represents Thailand, Malaysia, Vietnam, and the Philippines. EU data for 2018 is estimated by IEEJ.

Source: Trade statistics of each country, TEX report, EUROSTAT

Source: Trade statistics of each country, TEX report

Imports by Major Asian Import Countries(Jan. - Oct.)

30.1

-0.1

-50.9

4.0

37.4 35.0

-80

-60

-40

-20

0

20

40

60

80

2013 2014 2015 2016 2017 2018

アセアン

EU

インド

日本

韓国

中国

計

（百万ｔ）

88.0 122.0

94.4 91.6 101.7 144.1

94.5 91.1 107.0

162.1

91.4 85.0

020406080

100120140160180

中国インド日本韓国

（百万t） 2017年 2018年 2019年

+5.2%

+12.5%

+0.1% -3.2% -0.5%-6.8%

+18.1%

+15.5%

Millions of Tons

Millions of Tons

ASEAN

India

Japan

Korea

China

Total China India Japan Korea

2017 2018 2019

Year-On-Year Imports Changes


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Monthly Steam Coal Import Amounts for China and India

6

China Import amounts for February, March, and April of 2019 were lower than the previous

year, but exceeded it in the following months. The totals for January to Octobershowed an increase of 5.25 million tons year-over-year.

India Amounts from January to July exceeded the previous year but were lower from August

onwards. The total for January to October was 162.13 million tons imported (an increase of 18

million tons year-over-year).

Source: TEX reportSource: Trade Statistics for India

China India

0

5

10

15

20

25

1月 2月 3月 4月 5月 6月 7月 8月 9月 10月11月12月

2017 2018 2019（百万t）

0

2

4

6

8

10

12

14

16

1月 2月 3月 4月 5月 6月 7月 8月 9月 10月11月12月

2017 2018 2019（百万t）

Source: TEX report

Millions of Tons Millions of Tons

Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sept. Oct. Nov. Dec.


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Steam Coal Exports by Major Export Countries

7

Indonesia saw a 3-year long decrease from 2014 but saw increases again from2017.

Russia saw increases from 2016, with the US seeing increases from 2017. Increases were seen in Colombia in 2016/2017, with a decrease in 2018. Indonesia and Australia saw year-over-year increases for 2019. On the other

hand, both the US and Colombia saw decreases.

Year-On-Year Export Changes Major Export Countries’ Steam Coal Export Amounts (Jan. - Sept.)

Source: TEX report

51.2

4.6

-47.5

-5.2

66.6

35.2

-60

-40

-20

0

20

40

60

80

2013 2014 2015 2016 2017 2018

米国

南アフリカ

コロンビア

ロシア

ｲﾝﾄﾞﾈｼｱ

豪州

計

（百万t）

0

50

100

150

200

250

300

350

400

豪州

（1-9月）

米国

（1-9月）

ロシア

（1-9月）

コロンビア

（1-9月）

南ア

（1-9月）

ｲﾝﾄﾞﾈｼｱ

（1-9月）

（百万t） 2017年 2018年 2019年

Source: TEX report, IHS etc.

Millions of TonsMillions of Tons

US

South Africa

Colombia

Russia

Indonesia

Australia

Total

Australia US Russia Colombia South Africa

Indonesia

2017 2018 2019


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Trends in Coking Coal Prices

8

Spot coking coal prices from mid-October 2018 onwards trended towards$220/ton in the latter half. However, reduced supply and demand from 2019saw this drop to $190/ton before going on to exceed $200/ton.

This was followed by a steep drop to below $130/ton in September, before pricesrose to $150/ton. Current prices are trending at around $135/ton.

Trends in Spot Coking Coal Prices (Australian Premium Hard Coking Coal FOB)

Source: IHS

0

50

100

150

200

250

300

350

400

Jan-

10Ju

l-10

Jan-

11Ju

l-11

Jan-

12Ju

l-12

Jan-

13Ju

l-13

Jan-

14Ju

l-14

Jan-

15Ju

l-15

Jan-

16Ju

l-16

Jan-

17Ju

l-17

Jan-

18Ju

l-18

Jan-

19Ju

l-19

(US$/t)

100

120

140

160

180

200

220

240

260

Jan-

18

Feb-

18

Mar

-18

Apr

-18

May

-18

Jun-

18

Jul-1

8

Aug

-18

Sep

-18

Oct

-18

Nov

-18

Dec

-18

Jan-

19

Feb-

19

Mar

-19

Apr

-19

May

-19

Jun-

19

Jul-1

9

Aug

-19

Sep

-19

Oct

-19

Nov

-19

Dec

-19

(US$/t)


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Coking Coal Imports by Major Import Countries (Regions)

9

China saw decreases in both 2014 and 2015, increases in 2016 and 2017, and a further decrease in 2018.

India saw a decrease in 2016 but saw increases from 2017,18. Although there was a large increase in China in 2019, India saw its increase stop,

with Japan and Korea remaining almost flat.

Year-On-Year Coking Coal Import Changes

Source: Trade statistics of each country, TEX report, EUROSTAT

Source: Trade statistics of each country, TEX report

27.2

-5.0 -14.8

10.7 14.3

-1.5

-30

-20

-10

0

10

20

30

40

2013 2014 2015 2016 2017 2018

EU

インド

日本

韓国

中国

計

（百万ｔ）

58.5 37.2

58.3

26.9

56.9 42.3

56.7

26.0

66.8

42.5 56.8

26.5

01020304050607080

中国インド日本韓国

（百万t） 2017年 2018年 2019年

+17.3%

+0.5%

-2.8%+0.3%

-3.3%+1.8%

+13.6%

-2.7%

Imports by Major Asian Import Countries(Jan. - Oct.)

Millions of Tons

Millions of Tons

India

Japan

Korea

China

Total

China India Japan Korea

2017 2018 2019


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Monthly Coking Coal Import Amounts for China and India

10

China Import amounts for 2019 tended to exceed the previous year. The totals for

January to October showed an increase of 9.9 million tons year-over-year.India

Import amounts for 2019 saw some fluctuations but stayed at almost the same level as the previous year. The totals for January to October showed an increase of 210,000 tons year-over-year.

Source: TEX report Source: Trade Statistics for India

China India

0

1

2

3

4

5

6

1月 2月 3月 4月 5月 6月 7月 8月 9月 10月11月12月

2017 2018 2019（百万t）

0123456789

10

1月 2月 3月 4月 5月 6月 7月 8月 9月 10月11月12月

2017 2018 2019（百万t）Millions of Tons Millions of Tons

Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sept. Oct. Nov. Dec.


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Coking Coal Exports by Major Export Countries

11

Australia saw a sharp decrease in 2017, followed by an increase in 2018. The US and Canada saw increases in 2017 and 2018, with Russia seeing

increases between 2016 and 2018. In 2019, Australia, Russia, and Canada saw year-over-year increases in export

amounts. The US, however, saw decreases.

Year-On-Year Coking Coal Export Changes

Source: TEX report

Coking Coal Exports by Major Export Countries

30.2

6.5

-19.6

2.5

-2.2

19.5

-40

-30

-20

-10

0

10

20

30

40

2013 2014 2015 2016 2017 2018

米国

ロシア

カナダ

豪州

計

（百万t）

0

20

40

60

80

100

120

140

160

豪州

（1-9月）

米国

（1-9月）

ロシア

（1-9月）

カナダ

(1-6月）

（百万t） 2017年 2018年 2019年

Source: TEX report, IHS etc.

Millions of Tons

US

Canada

Russia

Australia

Total

Australia(Jan. to Sept.)

US(Jan. to Sept.)

Russia (Jan. to Sept.)

Canada(Jan. to Jun.)

Millions of Tons 2017 2018 2019


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2020 Coal Supply and Demand

12

[Steam Coal] Import demand for steam coal will increase even as we enter 2020. Import amounts will continue to increase in India in line with extra consumption. Increases will be seen in ASEAN nations such as Vietnam, Malaysia, and the

Philippines. In China, international coal prices are comparatively cheap compared to domestic

prices, so no decreases in imports are expected. However, it is likely that there will be ongoing import restrictions.

Europe is expected to maintain its ongoing decline. Ensuring Availability During 2020, Australia, Russia, and Colombia will all have excess availability. In Indonesia, a policy-related cap is expected, but production targets for 2019 are

600 million tons. Production amounts are not expected to decrease substantially in 2020.

[Coking Coal] Import demand for coking coal is expected to be impacted by demand for iron and

steel. Import amounts will increase in India in line with business recovery. In China, international coal prices are comparatively cheap compared to domestic

prices, so no decreases in imports are expected. However, it is likely that there will be ongoing import restrictions.

Ensuring Availability Suppliers such as Australia and Russia have excess availability.

There is concern that delayed plans due to price decreases etc. will reduce this availability.


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2020 Coal Prices

13

Trends in spot steam coal prices (FOB price at Newcastle Port, Australia):Prices hit a peak of $123/ton in July 2018 but fell to $62/ton in August 2019. Currentprices are trending at around $67/ton.In 2020 prices are expected to fluctuate at around $70 a ton, with seasonal factorscausing changes of between $5 - $10/ton.

Spot coking coal prices (Australian premium hard coking coal FOB price):Prices hit a peak of $210/ton in May 2019 but fell to below $130/ton in September.Prices briefly returned to $150/ton but are currently trending at around $135/ton.Prices are predicted to trend at around $140 to $150/ton in 2020.

Average Yearly Spot Prices for Steam and Coking Coal

2018 Average

2019 Average Jan. – Oct.

Average2019 Average 2020

Average

Steam Coal Spot Prices 106.30 79.15 77 70

Coking Coal Spot Prices 207.10 184.09 176 146


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outlook and challenges for international coal …china saw decreases in both 2014 and 2015,...

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