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Global coal demand to hold above 1bn tonnes – analyst

Seaborne thermal coal demand will remain marginally above 1bn tonnes this year, little changed from 2018, with supply only slightly outstripping import requirements, the director of consultancy Perret Associates told Montel.

“Global supply and demand is still relatively tight,” said Guillaume Perret, noting the consultancy’s latest forecasts showed there would be an estimated surplus of just 6m tonnes in supply this year.

While Chinese import demand could decline 12% to 187m tonnes, this would be in part offset by a 10% upturn in Indian demand, to 176m tonnes.

There would also be a likely step-up in demand from the Philippines and Vietnam – each by more than 2m tonnes – to 26m tonnes and 25mt tonnes, respectively.

Combined European and Mediterranean demand would slip by nearly 3% to 148.7m tonnes, with increased Turkish and Egyptian demand partially countering a “sharp” drop in northwest European imports, Perret said, without giving outright figures.

Supply question
“The big question is supply, as Colombia will struggle to raise exports,” he said, citing legal barriers to expanding mining capacity and possible weather-related issues hampering output.

It also remained unclear if Indonesia would raise exports this year.

“Most large miners want to increase, but the government is pushing to cap output,” he said.

Indonesia last month set a coal production target of 489.1m tonnes for this year, down 7% from the 2018 total, reflecting government efforts to limit oversupply amid declining prices, Montel reported.

Furthermore, US exports could decline this year, by an estimated 9% to 47m tonnes, Perret said, pointing to reduced production and lower domestic inventories.

Yet there was likely to be some increase in exports from Russia and South Africa, he added.
Source: Montel

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