Asia is in great need of affordable energy as soaring temperatures have significantly increased the need for air conditioning and raised the continent’s energy needs. For the past couple of years, Asian nations such as China and India have ramped up coal imports from Russia, which is currently sanctioned by several Western countries, and bought $24 billion worth of energy from the Kremlin.
Now that Asia has proven that it is hungry for energy stockpiles, some European countries are considering reselling coal to Asia. According to sources, some players in the European Union are looking to offload their thermal coal stockpiles on the Asian market amid growing stocks and strong energy demand in Asian countries. Even though coal prices have fallen in recent months amid a strong push for renewable energy sources, demand for the polluting source of energy has been relatively lackluster due to increased domestic production.
Despite this, players in the European market are already reaching out to Asia buyers to purchase some of the thermal coal stockpiles stored at European ports. Sources in Asia have revealed that several market participants have reached out and offered to offload stocks of high calorific value coal that are primarily used in most thermal power plants.
A major buyer and trader based in India said that although they recently bought a shipment of Polish coal, they have received even more offers to buy coal. The buyer noted that since global coal prices have dropped significantly in recent months, some European players are more than ready to sell their coal stockpiles at a loss to prevent their stocks from declining even further.
Coal prices started going down in the second half of 2022, and experts predict that they will be even lower in 2023. South African coal declined in price due to increased competition on the global arena while Australian coal prices dropped from $134/mt at the start of the year to $104/mt on May 23, 2023. A U.S.-based trader notes that South African coal has been forced to compete with supplies from Indonesia, Australia and Colombia even as the demand for coal among developed economies declines.
As such, buyers in Europe are looking to secure buyers in the Asian market and resell their coal before prices can decline any further. However, European coal may not attract enough Asian buyers because the coal isn’t fresh and Asian buyers can purchase fresh coal at competitive prices. One Indian-based buyer said that European sellers may be able to resell their coal in Asia if they offer “much lower prices.”
These cyclic movements in the prices of commodities such as coal aren’t a new thing and large companies such as Warrior Met Coal Inc. (NYSE: HCC) take those dips in price in stride while waiting for better market conditions to bolster their earnings.
MiningNewsWire (MNW) is a specialized communications platform focused on developments and opportunities in the global resources sector. The company provides (1) access to a network of wire services via NetworkWire to reach all target markets, industries and demographics in the most effective manner possible, (2) article and editorial syndication to 5,000+ news outlets (3), enhanced press release services to ensure maximum impact, (4) social media distribution via the Investor Brand Network (IBN) to millions of social media followers, and (5) a full array of corporate communications solutions. As a multifaceted organization with an extensive team of contributing journalists and writers, MNW is uniquely positioned to best serve private and public companies that desire to reach a wide audience of investors, consumers, journalists and the general public. By cutting through the overload of information in today’s market, MNW brings its clients unparalleled visibility, recognition and brand awareness. MNW is where news, content and information converge.
To receive SMS text alerts from MiningNewsWire, text “BigHole” to 844-397-5787 (U.S. Mobile Phones Only)
For more information, please visit https://www.miningnewswire.com
MiningNewsWire is part of the InvestorBrandNetwork.