The coal industry is hurting. While the emissions heavy fossil fuel has been falling out of favor for quite a while now, this year has been particularly brutal. In no small part thanks to the spread of the novel coronavirus and the ensuing drop in energy demand, the nuclear sector is in big trouble. For just a taste of the kind of summer coal has had, here is just a small selection of the nearly uniform doom-and-gloom headlines on offer: “Renewables surpass coal in US energy generation for first time in 130 years” from the Guardian, “Coal’s Decline Continues with 13 Plant Closures Announced in 2020” from Scientific American’s E&E Energy News platform, and “The U.S. Coal Industry Is Declining Irreversibly” from us here at Oil Price. But this disaster has been decades in the making. Between the years of 2009 and 2019, coal demand plummeted 43 percent by an energy-equivalent metric, as reported by BP Plc’s most recent statistical energy review. In Europe, coal demand dropped 23 percent. The UK experienced a stunning 79 percent decline and the few active coal-fired plants it has left are growing less active all the time…Full Story
Among China’s generally strong imports of major commodities in August there was one standout area of weakness – the large drop in coal.
China’s coal imports fell to an eight-month low of 20.66 million tonnes in August, down 20.8% from July’s 26.1 million and a massive 33% below the level recorded in August last year, according to customs data.
The soft August outcome meant the growth in imports in the first eight months of the year slipped to just 0.2% from the same period in 2019, down from 6.8% in the first seven months in the year…Full Story
By Min Zhang in Beijing and Emily Chow in Shanghai | Reuters
China’s iron ore imports in August fell 10.9% from a month earlier, easing from a record high in July on fewer shipments from big miners and port congestion, official customs data showed on Monday.
The world’s top iron ore consumer brought in 100.36 million tonnes of iron ore last month, according to data from the General Administration of Customs. That was down from 112.65 million tonnes in July and up 5.8% from the same period a year earlier.
“Iron ore imports in China were partly delayed last month due to coronavirus-related restrictions,” said Tang Binghua, analyst with Founder CIFCO Futures, noting that port congestion in China was heavy last month and slowed customs clearance.
Shipments from big miners in July also dipped after the end of the financial year in Australia, Tang added…Full Story
Iron ore futures firmed on Tuesday, with both Dalian and Singapore benchmark contracts gaining more than $3 on expectations that steel usage in China would remain robust in the coming months and offset sluggish demand overseas.
The Dalian Commodity Exchange’s most-traded iron ore for delivery in January 2021 closed the session 3.5% higher at 863 yuan ($124.51) a tonne, rising for a fourth session in a row.
Iron ore’s front-month September contract on the Singapore Exchange climbed 3% to $120.42 a tonne in afternoon trade, extending gains into a third straight session.
“Market participants are looking forward to a strong second half for Chinese steel demand which should maintain steel and iron ore prices above previous expectations,” said Justin Smirk, senior economist at Westpac Economic Research…Full Story
Swiss-based mining giant Glencore will suspend several coal mines across the Hunter Valley in New South Wales for at least two weeks as the coronavirus pandemic and Chinese government policies to avoid Australian coal cargoes hit demand for the commodity.
Glencore on Friday said the site and equipment shutdowns, which would coincide with September school holidays, were necessary in order to wind back output volumes and manage the severe impact on demand. Workers would be required to take annual leave over this time, it said.
“Our focus is on taking the necessary steps to continue operations, manage the current market volatility and limit the impact on our workforce,” the company said on Friday.
“These measures will enable us to align our production levels with market demand, while providing the flexibility to ramp back up as economies recover.”…Full Story
Iron ore is continuing to defy the global economic gloom, with both futures in China and the spot price surging to the highest this year, showing how the steel-making ingredient is benefiting from a cocktail of supply concerns and demand hopes.
The Dalian Commodity Exchange’s most-active contract , for September delivery, ended at 723 yuan ($101.40) a tonne on May 22, up 25.2% since the start of the year in local currency terms.
The spot price for benchmark 62% iron ore delivered to China MT-IO-QIN62=ARG, as assessed by commodity price reporting agency Argus, ended at $97.30 a tonne on May 22, down slightly from the previous day’s close of $97.85, which was the highest price in eight months…Full Story
Analysts have shot down Beijing’s threat that China will replace its massive Australian iron ore imports with Brazilian ore, as China opens up another front in the fledgling Australia-China trade war.
State-controlled media The Global Times warned China could abandon Australian iron ore as it prepares to slap restrictions on Australian beef and barley after Beijing accused Australia of flouting world trade rules.
The accusation from Australia’s largest trading partner follows Prime Minister Scott Morrison’s calls for an international inquiry into the handling of COVID-19.
But one major obstacle undermines China’s threat to replace Australian iron ore with Brazilian: there simply isn’t enough of the core commodity used to make steel to meet China’s demand.
“The market is very tight, everyone is running as hard as they can … you couldn’t find a spare tonne elsewhere in the market,” UBS analyst Glyn Lawcock said…Full Story
By Enrico Dela Cruz
Chinese iron ore futures edged higher on Thursday on supply concerns as coronavirus containment measures across the world intensified, but clouded demand outlook for the steelmaking raw material and steel products capped gains.
The most-traded May iron ore contract on the Dalian Commodity Exchange ended the morning session up 0.2% at 658.50 yuan ($92.67) a tonne. The front-month April contract on the Singapore Exchange, however, fell as much as 1.9%.
Supply concerns also supported spot prices. The benchmark 62% iron ore bound for China, the biggest buyer of the raw material and which accounts for more than half of the world’s steel output, was well above $80 a tonne.
“Prices (are) trading above US$80/T level, comfortably supported by expectations of a potential supply deficit in 2020 as many major producing countries announce complete lockdowns,” commodity strategists at ING wrote in a note…Full Story
By Victoria Zou | MySteel
China’s imported iron ore prices in both the spot and futures markets have been rather volatile since February 3, the supposedly first working day after the lengthy Chinese New Year holiday, and the fluctuation may probably continue in the near term with the mix of positive and negative signals making it hard for investors to agree on the market trend, market sources shared over March 4-6.
China’s iron ore market fundamentals have been rather intact, as reduced demand has been balanced out by lower supply in the first quarter so far, and some positive signs have also emerged in Chinese steel markets with many industrial sectors in the country other than in Hubei having reopened for operations especially since the last week of February.
The global economy, the bigger context for the iron ore market, however, has been with more uncertainties when as of March 8, there had been 105,586 confirmed novel coronavirus disease (COVID-19) cases, with 80,859 in China and the balanced shared among the other 101 countries, territories, and areas, according to the latest situation report from the World Health Organization.
Iron ore, as a bulk commodity that has both the physical and derivatives characteristics, saw the two forces take turns in leading the price movements.
Over February 3-March 6, in the physical market, Mysteel’s SEADEX 62% Fe Australian iron ore fines ranged $79.90-91.65/dmt CFR Qingdao, and Mysteel’s PORTDEX 62% Fe Australian iron ore fines moved between Yuan 604-680/dmt FOT Qingdao and including the 13% VAT…Full Story
Asia’s seaborne coal markets stumbled in February and it appears the coronavirus outbreak in China may dodge most of the blame, with the weakness concentrated in other major importers of the polluting fuel.
South Korea’s imports of both thermal and coking coal were particularly hard hit, dropping to 6.9 million tonnes in February from 11.4 million in January and 9.4 million in February 2019, according to vessel-tracking and port data compiled by Refinitiv.
That was the lowest monthly imports for South Korea since Refinitiv started vessel-tracking in January 2015.
South Korea’s weak coal demand was sparked by the country’s decision to close up to 15 coal-fired power plants between December and February in order to limit air pollution over winter.
South Korea, Asia’s fourth-largest economy, has about 60 coal-fired power plants, generating 40% of the country’s electricity, with nuclear holding a 30% share and natural gas around 20%.
The bad news for coal exporters is that South Korea will extend the closure of coal-fired plants this month, with the Energy Ministry saying on March 1 that up to 28 plants will be idled this month.
The longer-term prognosis may be equally bleak, with plans to reduce coal generation even further in response to growing public calls for cleaner air…Full Story