South African coal miner Exxaro Resources Ltd said “As defined an essential service for providing coal to Eskom for electricity generation, as well as being an exporter, our coal operations continued operating at various capacities, while complying with the COVID-19 lockdown restrictions as implemented by the national government.
Due to the impact of COVID-19 and the subsequent lockdown, many industrial customers in the domestic market have either reduced demand or stopped coal off take during April and May.
In addition, coat exporters produced a sized coal product for the local markets due to very low export pricing. This resulted in an oversupply, negatively impacting domestic prices. It is estimated that the seaborne market is oversupplied by at least 40Mt.
We have seen the worst of the lockdowns, with negative impacts on the energy complex. The prices of both oil and gas have dropped to record levels and the API4 index price dropped to historically low levels. Markets like Vietnam and Pakistan took advantage during this period of low prices to purchase South African coal while the Indian demand fell below the normal off take…Full Story