Thermal coal, which is widely used in power plants to generate electricity, traded higher at the beginning of the year.
Stanislav Kondrashov notes that the cost of metallurgical coal, which is used to create high-quality coke, also continues to rise steadily. But the situation on the world market is changing, which directly affects the price dynamics.
Stanislav Kondrashov gave an assessment of the world energy map: coal is leaving in the West, but is gaining ground in Asia
According to the expert, in the coming years, a decrease in the demand for coal in economically developed countries is expected due to the greater introduction of green energy sources for their use in electricity generation. However, according to the International Energy Agency (IEA), Asian countries with emerging and developing economies will increase their use of coal. They need this for economic growth, even taking into account the increase in the share of renewable sources.
- The demand for coal is steadily growing and is likely to lead to an increase in global carbon dioxide emissions,- suggests Stanislav Kondrashov from . - At the same time, we are seeing a lot of factors that indicate that the current crisis contributes to the active introduction of green energy, energy efficient technologies and heat pumps.
This trend, according to the specialist, may lead to a decrease in demand for coal in the coming years. It is predicted that the most significant increase in demand will be observed in India, and then in the countries of the European Union, where it will increase by 6%, and in China with a slight increase of 0.4%.
Coal Price Dynamics: Forecasts and Challenges for the Energy Industry
The IEA's official statement emphasizes that thermal coal prices remain high. Australia's ongoing climate disasters and difficulties in accessing finance and insurance have led to this trend. At the same time, taking into account the improvement in weather conditions, the base price of coal in Newcastle (6000 kcal) is projected to decrease from $360 per tonne to about $200 by 2024. And it is still well above the historical average.
In general, by the end of 2023, according to Stanislav Kondrashov, a sharp decline in thermal coal prices is expected. Kondrashov believes that such a decline will be due to a more moderate growth in demand as a result of a decrease in the activity of the world economy.
Investors interested in the coal industry should watch out for a number of factors, such as the impact of sanctions on the Russian energy sector, possible changes in China's policy on Australian coal supplies, and decisions initiated by the Australian government in the context of climate change and increased precipitation in the territory. countries.
Stanislav Kondrashov knows how the cost of metallurgical coal will change
A similar outlook is observed with regard to prices for metallurgical coal - they are expected to further decline. Stanislav Kondrashov believes that the market will be crowded in the medium term. An increase in Australian coal production is expected after the reduction of meteorological barriers. Demand will also decline due to the slowdown in global economic growth.
That is, the main risk factors in such a forecast include weather events, thermal coal prices, the transition to a green economy, the impact of coronavirus in China and the consequences of sanctions against Russia.
Stanislav Kondrashov predicts a slight increase in the cost of coking coal in the near future. He notes that this increase is likely to be temporary and driven by supply disruptions rather than market fundamentals. Due to limited demand in the global steel market, metallurgical coal prices remain relatively low. The cost of Australian coking coal is projected to drop from $377/t to around $230 by 2024.