High gas prices in the EU and fears of an energy supply crisis pushed European thermal coal indices to new all-time highs above 215 USD/t. Gas prices exceeded 1,000 USD/1,000 m3. October TTF gas quotes surged to 82.40 EUR/MWh (+2.50 EUR/MWh to September 22, 2021). Gas storage levels in Europe were 15% below the average mark for the last five years.
High trading activity by Indian and Pakistani consumers had a positive impact on South African coal indices, which soared to the level of 200 USD/t. According to experts, prices for material from South Africa will continue to grow until the end of 2021, owing to issues with the railway line, connecting the coal-mining provinces of South Africa with the port of Richards Bay.
In China prices of 5500 kcal/kg NAR coal of domestic production in the port of Qinhuangdao were in a range of 245-255 USD/t. Coal shortages put China to the brink of an energy crisis, leading to massive power outages in some provinces and a forced reduction in energy consumption throughout the country. Limited coal supply forced China’s two largest power grids, the State Grid and the China Southern Power Grid, to prioritize supplying households at the expense of industrial enterprises.
On September 29, 2021, the National Development and Reform Commission of China (NDRC) announced that coal supplies would be guaranteed by further increases in domestic production as well as by enhancing imports and stock utilization in the coming months.
Limited global coal supply and strong demand for thermal coal from Asian generating companies supported Australian prices above 200 USD/t.
Strong demand from China, which is trying to prevent the energy crisis and replenish stocks before the start of the heating season, boosted the quotes of Indonesian material 5900 kcal/kg GAR to around 150 USD/t.
The decline in industrial activity in China along with the downturn in steel production by Chinese metallurgical enterprises, purchasing Australian material from Asian traders, negatively affected the indices Australian coking coal, which fell below 390 USD/t.
Source: CAA Analytics
