![]() Indonesian exports rose 14% in 2022 and reached an all-time high despite two temporary export bans.īoth coal prices and demand are expected to decline in the medium term. Russian exports, which increased overall, have been redirected to China and India, following the EU ban of Russian coal in 2022Q3. have remained broadly stable in 2022 (although some were redirected to Europe). Exports from South Africa to Europe experienced an almost six-fold increase, while exports from the U.S. Reduced Russian coal exports to Europe were balanced by increases from Colombia and South Africa. On the other hand, production in South Africa has decreased due to labor and rail transport constraints. In Indonesia, production has increased to 4% above its annual target. In the United States, coal production increased by 3% in 2022, despite the decrease in domestic consumption and logistic constraints. China increased output by 11% compared to 2021, while production in India rose by 16%. Global production reached an all-time high in 2022. This limited the substitution between coal and gas for electricity generation in the U.S. On the other hand, coal consumption in the United States decreased by 8% in 2022Q4 due to less significant natural gas price increases compared to Europe. Consumption in China rose modestly, as economic growth remained sluggish due to COVID-19 restrictions. Consumption rose strongly in India (10%) and in Europe (5%) in response to electricity generating facilities substituting away from natural gas and filling the supply gap created by weaker production from other sources, including nuclear and hydro. Global demand reached an all-time high in 2022. The gap between the two benchmarks, which had been caused by supply disruptions in Australia due to the tropical cyclone season and the limited ability of Asian utilities to switch away from high-grade Australian coal to low-grade alternatives, has almost disappeared. The Australian and South African benchmark prices have fallen by about 50% from their peaks in September and April 2022, respectively, due to increased production and warmer weather. Possible supply redirection from the ongoing Russian invasion of Ukraine and a faster-than-expected pace of China’s reopening could impact the outlook of falling prices.Ĭoal prices started to decline in the second half of 2022, although they remain much higher than their 5-year average. Prices are expected to be lower in 2023 (on average) compared to 2022 but remain high by historical standards. On the supply side, increased exports by countries such as South Africa and Colombia-whose combined share in total European imports has been 35% since August 2022-have partially offset the reduction of Russian exports to Europe. Global coal consumption levels reached an all-time high in 2022, led by India and China. This blog is the last in a series of 11 blogs on commodity market developments, elaborating on themes discussed in the October 2022 edition of the World Bank’s Commodity Markets Outlook.Ĭoal prices have been retreating from their highs in 2022 but they remain well above the 2017-2021 average. ![]()
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