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Expensive and scarce coal in Asia

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The price of coal is soaring, whether it is thermal coal or coking coal. And the situation is becoming critical in India and China.

With 220 dollars per tonne on average these days against 50 dollars in spring 2020, Australian coal prices illustrate the extent of the surge in prices. ” It can’t realistically go higher “, Assures an expert still astonished to witness such a boom in the markets.

Especially since this increase concerns the two coals, the thermal used for the power stations and the coking coal which feeds the steel industry.

Faced with gas prices, demand for coal is picking up again

According to Philippe Chalmin, professor of economic history at the University of Paris-Dauphine and expert in raw materials, the recent follies of gas largely explain what is happening today. Its prices are such that all who have the possibility turn to coal. Except that production has slowed down worldwide under pressure from climate objectives, contrary to the still very strong energy demand. As a result, among heavy consumers the situation becomes critical.

In China, a country that is more than 60% dependent on this resource, the authorities have asked 72 mines located in Inner Mongolia to increase their speed. The droughts of recent months have undermined national hydropower production, and despite the country’s desire to reduce its climate footprint, coal is once again emerging as the easiest resort.

In India inevitable power cuts

In India, the world’s second largest consumer of coal, the tension is enormous. Half of India’s 135 coal-fired power plants had only 3 days of stock at the end of last week.

Unable to buy imported coal that has become too expensive, the state is pressuring Coal India to increase production. The public giant says it is on the war footing, the Indians are preparing themselves without too much illusion for power cuts already scheduled in several cities of the country.

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