Coal news and updates

Thermal coal price surges above $200 as supply shortage worsen

Thermal coal prices surges above $200 as supply shortages worsen and higher Chinese-led demand for winter heating gripped the market.

Newcastle coal futures, the benchmark for coal trading in Asia, surged to $204.75 a tonne on Monday.

“Coal inventories in China continue to drop at the time when utilities in the country need supplies to prepare for winter. India also needs coal because they are seeing widening shortage as inventories continue to deplete,” Ahmad Zuhdi, industrial analyst at Jakarta-based Bank Mandiri’s Chief of Economist Office told Capital.com.

The prices for power-station fuel have more than tripled since end of 2020 on China’s robust demand as its economy was recovering from the coronavirus pandemic. At the same time, major producing countries could not step up to increase output due to weather and underinvestment during the Covid-19 pandemic which knocked coal demand last year.