Last week, thermal coal quotes in Europe renewed their all-time highs, exceeding 180 USD/t, despite a slight correction in gas indices. The limited supply of the material on the EU market in the run-up to heating season amid the declining wind output in the EU countries supported European coal prices. October TTF gas quotes edged down to 69.4 EUR/MWh (-1.1 EUR/MWh to September 16, 2021). ARA coal stocks declined to 4.3 mio t (-0.3 mio t to September 16, 2021).
Indices of South African material spiked above 160 USD/t. According to experts, coal prices for coal 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 Australia coal quotes strengthened above 185 USD/t, supported by the strong demand for Australian thermal coal from Asian generating companies ahead of the winter season.
On September 23, 2021, the South Korean power corporation KEPCO announced its plans to raise electricity tariffs due to the upsurge in prices for energy commodities. This will be the first tariff increase since November 2013. Previously, payments were charged at a flat rate, but currently the tariffs will be linked to global energy prices and will be adjusted every three months, depending on the dynamics of world indices for LNG, coal and crude oil. In Q2 2021, KEPCO posted a net loss of 571 mio USD.
The quotes of the Indonesian material 5900 kcal/kg GAR exceeded 140 USD/t, driven by the increased demand from Chinese consumers amid force majeure, announced by a number of local mining companies, resulting from heavy rains and floods in the country.
The limited supply of coking coal by key coal-mining countries as well as high prices forced Chinese steel mills to buy Australian material from Asian traders, strengthening indices of the Australian material above 400 USD/t.
Source: CAA Analytics
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