Thermal coal demand in Asia to rise

The report by Commodity Insight, noted that there were several fundamental factors driving this growth in demand, including high electricity demand, high population growth, significant coal-fired generation capacity, and the inability of domestic coal production to keep pace with demand growth.

The report noted that Australia’s world leading thermal coal producers could benefit from this future demand growth in the region.

MCA CEO Tania Constable noted that the the forecasts would be subject to changes in government policy, including emissions reduction measures to meet Paris Agreement targets.

“Australian thermal coal is amongst the highest quality in the world, enabling more energy to be produced with less CO2 emitted per kWh of electricity produced than most alternative sources,” Constable said.

“It is critically important to achieve global net zero emissions, and there are clearly challenges ahead in the Asia-Pacific region in relation to emissions reduction, requiring consideration of low-emissions technologies such as carbon capture, use and storage (CCUS), renewables, gas and nuclear power to meet Paris Agreement goals.”

Constable noted that as the world recovered from Covid-19 and worked towards a zero net emissions future, Australian minerals companies would play a central role in providing the resources needed to grow sustainably in coming decades.

In 2019-20, Australia’s exports of thermal and metallurgical coal were worth A$54.6-billion, which was 11.5% of Australia’s total export revenue of A$474.8-billion. Thermal coal exports in 2019 from Australia amounted to 212-million tonnes.