Global coal update

The country added 47.4 Gigawatts (GW) of new coal power in 2023, more than double the amount added by the rest of the world combined…Meanwhile global coal capacity outside China increased for the first time since 2019, a trend Global Energy Monitor (GEM) called “concerning”…

Chinese Communist Party target to shut down 30GW of coal power by 2025 - with only 9GW retired in the last few years…

Seven other countries added new coal power in 2023 too, GEM found. Those were Indonesia, India, Vietnam, Japan, Bangladesh, Pakistan, South Korea, Greece, and Zimbabwe. But GEM also partly blamed the global net increase in coal power on rich countries stalling plant closures amid the energy crisis in 2022. Coal power retirements in 2023 were at their lowest level since 2011.


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The Clean Energy Era Isn’t Keeping Coal Stocks Down. Record Demand Fuels Fresh Surge.
Coal stocks launched into a steep rally in 2020. In 2022, Russia’s invasion of Ukraine supercharged natural gas prices, making coal once again price-competitive. In 2023, coal stocks pulled back from March to early June. They then launched into an almost 75% rally — with the 13-stock group surging 25% in September.

Why? One piece of the complex answer is metallurgical or coking coal. Still a critical ingredient in traditional blast-furnace steel production, U.S. met coal comes from Appalachian region mines and earns a hefty premium to the thermal coal used in power generation. Met coal miners Consol Energy and coal supplier Alpha Metallurgical Resources have led the industry charge, soaring 61% and 52%, respectively, in 2023…

Meanwhile, strong demand in Asia continues to drive the thermal coal market, with China still producing more than half of its electricity from coal plants. “That, in a nutshell on the coal side, is why the coal stocks have been strong,” Pipes said…

“The biggest theme in financial markets has been the relentless rise in interest rates,” Pipes told IBD. “If you have a lot of debt and that debt (matures) too soon, you’re in pretty hot water no matter what industry you’re in.”

On this front, coal had a little bit of help from clean-energy advocates. Pressures related to ESG investing effectively shut coal producers out of the credit markets over the past five years, Pipes said. Unable to refinance their debt loads, miners took advantage of rising coal prices to pay off their remaining credit. As a result, they now have very clean balance sheets, according to Pipes.



China’s coal imports are also strong.

China’s first quarter coal imports surge, defying gloomy forecasts

LAUNCESTON, Australia, April 9 (Reuters) - China’s coal industry says it doesn’t expect imports to increase this year, but the evidence from the first quarter is that the appetite of the world’s biggest buyer remains ravenous.

China’s imports of all grades of coal from the seaborne market were 97.43 million metric tons in the first quarter of 2024, up 16.9% from 83.36 million tons in the same period in 2023, according to data compiled by commodity analysts Kpler.

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From the article, China imported 474 million tonnes of coal in 2023. This is more coal than the US burns in total. And that is only China’s imports. With domestic production plus imports, China burns about 9 times more coal than the US. And the atmospheric CO2 concentration just keeps going up.

  • Pete