European Demand for Imported Coal May Stay Weak, Euracoal Says

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

30 Nov 2009

European demand for imported coal may be kept “weak” by the price of competing gas and increased power generation from renewable sources, industry group Euracoal said. World trade in coal burned for power fell to 311 million metric tons in the first half of 2009, from 315 million tons in the same period last year, Euracoal said in a statement e-mailed today. Demand from India and China, the most populous nations, was a “stabilizing” factor. Without China’s role as a net coal importer, the world market would have been oversupplied by 52 million tons, the group said.
“Low gas prices and increasing amounts of electricity from renewable sources will keep demand weak for imported coal in Europe but also in the U.S.,” Brussels-based Euracoal said. Lower industrial production among the 30-member nations of the Organization for Economic Cooperation and Development may curb demand for coal and electricity in 2010, it added.
Power producers in the U.K., the EU’s third-biggest economy, held record coal stockpiles for a fifth consecutive month in September, government data showed last week. Prices for shipments from Richards Bay, South Africa have slid 14 percent in the last 12 months, data from McCloskey Group Ltd. showed. Europe gets more coal for power from the country than any other single source.
U.K. natural gas contracts for next year have fallen 40 percent over the past 12 months, according to data from Spectron Group Ltd.

Source: Bloomberg