reach 53 million t, outpacing China’s
forecast imports of 45 million t.
Similarly in thermal coal, India is set to
overtake China as the world’s largest
importer of thermal coal this year with
imports of 174 million t compared to
China’s 157 million t. With the vast
majorty of Chinese domestic production
reportedly unprofitable at current prices,
Chinese imports have slowed due to
measures supporting the domestic
industry, along with falling economic
growth and increased hydroelectric
output.
In contrast, India’s coal production
has failed to keep pace with rising
demand, with 113 GW of new coal-fired
capacity either under construction or
approved.
The QRC’s Roche has highlighted
India’s growing demand as a positive
factor for both metallurgical and thermal
coal: “From 2017, India’s new coal-fired
projects require high‑energy low‑ash
coal. India’s domestic coal is largely
high‑ash low‑energy,” he said in a
statement. “There are 300 million people
in India who don’t have access to basic
electricity and the Indian Government
has been clear it wants to change that.”
WoodMackenzie’s Spalding said
rising export demand would outpace
output from existing mines by the end of
the decade.“We expect that marketable
coal production capacity of existing mines
will peak in 2020 and decline steadily
thereafter. New projects will need to be
developed to support longer‑term
production growth – we estimate an
additional 40 million tpa of output by
2020 and 127 million tpa by 2025,” he said.
“Indonesia remains a significant
exporter of thermal coal, whileAustralia
is strong in both thermal and
metallurgical coal. If you combined
thermal and metallurgical seaborne coal
exports, we will expect Australia to
replace Indonesia as the top exporter by
2020.”
The Minerals Council of Australia’s
Greg Evans, Executive Director for Coal,
also noted the industry’s positive
long‑term prospects: “The demand for
Australian coal is expected to continue to
grow in Southeast Asia as the demand for
inexpensive and reliable electricity
sources increase,” he said. He pointed to
India’s growing coal-fired power capacity,
along with its push for new plants to use
“supercritical technology” or better, which
requires higher‑quality coal.
Recent free trade agreements with
major Asian trading partners China, Japan
and South Korea are also set to eliminate a
range of tariff and other barriers to
Australian minerals and energy trade,
worth more thanAUS$120 billion
annually, he said.
BalanceAdvisory Director,
Michael Ryan, said another boomwas
unlikely, but the industry was in a much
better position for an upturn. “Will we see
massive investment in infrastructure?
Perhaps not – but you’ll see smarter ways
of doing things, incremental investments
and add‑ons to existing ports and
railways. You’ll see the Galilee take off
and the Surat […] it’s a generally positive
outlook after a very difficult few years,”
he said.
For an industry struggling to overcome
pricing pain, stronger demand from India
andASEAN could yet prove the perfect
tonic.
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