Crazy! Record Coal Price & Skyrocket to US$ 446/Ton

Jakarta, CNBC Indonesia – Coal prices soared into the sky and hit their all-time high again. The market is worried about supply disruptions from Russia as the conflict in Ukraine escalates.

According to Refinitiv data, on Wednesday (3/2/2022), the price of coal on the ICE market, Newcastle (Australia) closed up 46.01% to the level of US$ 446/ton. This is the highest on record since at least 2008.

With this, since the beginning of the year (ytd), the price of the black stone has skyrocketed to 193.90%. Meanwhile, in the last year, the price of coal has increased by 425.32%.

The prospect of increasing demand seems to be the pillar of the current increase in coal prices. The Russia-Ukraine conflict that continues to heat up has threatened the supply of natural gas in Europe.

Just so you know, the Red Bear Country is the supplier of about 35% of the gas needs in the Blue Continent. The war, plus various sanctions for Russia, will put those supplies in jeopardy.

Therefore, coal will be looked at again as a primary energy source to replace natural gas. Germany itself has opened a discourse about this.

To reduce dependence on natural gas from Russia, the German government plans to extend the ‘service period’ of coal-fired power plants. Previously, the Panzer State had a plan to retire coal-fired power plants by 2030.

To reduce dependence on natural gas from Russia, the German government plans to extend the ‘service period’ of coal-fired power plants. Previously, the Panzer State had a plan to retire coal-fired power plants by 2030.

“Developments in the last few days have shown us all that energy policy is not only about the economy and the environment. But also security. We must change our dependence on energy imports from one country,” said Olaf Scholz, Chancellor of Germany, as quoted by Reuters.

Robert Hebeck, German Economy Minister, said the government was considering extending the use of coal-fired power plants beyond the retirement target by 2030. “Discussions and deliberation are not taboo. Germany’s goal is to select countries that will supply energy sources,” said Hebeck, also reported by Reuters.

From a producer’s perspective, Yancoal chief executive David Moult said his customers in the Asian region were scrambling to find alternative supplies to replace Russian coal. He predicts the military conflict in Ukraine will prolong the period of coal price rally.

“I expect energy prices to continue to rise with such conflicts [Rusia-Ukraina] is going on, the side effect for us is the fact that there are countries that normally buy Russian coal that are not going to buy Russian coal at this time,” he said, quoted by AFR.

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