The drastic decline of the market for coal
The price of coal price fell by almost a third last year as the world turns its back on the dirty fuel
“Coal’s fortunes look bleak”, says Jeremy Hodges on Bloomberg. The fuel’s price fell by almost a third last year to around $62 per tonne with little prospect of a pick-up in 2020. A combination of falling gas prices, “ever-cheaper wind and solar power” and carbon- emissions reduction policies are driving a “drastic” decline in generators that burn coal. Last spring the UK went for a full week without coal power for the first time since the industrial revolution.
Bulls point to new coal-fired power stations coming online in Asia, say Joe Wallace and David Hodari in The Wall Street Journal. China accounts for about half of global coal demand. Yet Beijing is taking a protectionist turn as it wants to preserve “the domestic coal industry because it’s the source of employment for so many people”, says Manjot Singh of CRU Group. It is importing less coal, which has also tempered global demand.
Australia’s coal industry has been hardest hit, reports Adam Morton in The Guardian. China’s imposition of what amounted to “an unannounced ban” on the country’s coal last year means that the industry’s export earnings are forecast to fall by more than a quarter over the two years from 2018. Western markets are not taking up the slack. Demand for coal-fired power fell 23% in Europe and 14% in the US during the first nine months of 2019.