Coal news and updates

Poland is set to increase thermal coal imports in 2018, owing to a lack of domestic supply, with Russian material likely to prevail because of its freight advantages, market sources said Thursday.

 

"Russia will be the largest exporter to Poland this year, with the US or Colombia coming second," said one Poland-based trader, explaining that through freight advantage alone, Russian coals have a significant advantage in the Polish import coal market.

 

According to S&P Global Platts trade flow software cFlow, so far in 2018, 31 coal-laden and part-laden ships have arrived in the port of Gdansk, six of which came from Russia and nine from the US.Sources said Russian producers have a secondary freight advantage as they are able to be export large volumes to Poland via rail.

 

"There is not enough domestic production to sustain the Polish market," said the trader, explaining that owing to how dependent Poland is on coal-fired generation, utilities cannot rely on domestic supply alone, despite it being the cheapest option.

 

Imports rose 61% on year to 13.4 million mt in 2017, the highest level since 2011, according to Poland-based consultancy, the Industrial Development Agency (ARP).

 

Polish hard coal production in 2017 fell 6.9% year on year to 65.5 million mt, whilst sales dropped 9.3% to 66.3 million mt, according to the ARP.

 

Poland generates around 80% of its electricity from hard coal and lignite-fired plants.

 

"There could be large imports this year as domestic mines are down on production," said a trader source.

 

The source, who trades Colombian coal, said he also expected the majority of Polish imports this year to be of Russian origin but said there could be around 2.5 million mt to be imported from other global origins.

 

Source: platts