Newcastle coal futures have surged back to $140 per tonne following a dip to a seven-week low of $137 on Stember 16th. In China, coal prices were bolstered by a combination of factors: heavy rains led to reduced production, increased safety inspections at mines, and a spike in consumer demand as the country approaches national holidays from October 1-7. Additionally, maintenance on several railroad lines in Shanxi province, crucial for coal transport, has further impacted supply.
Conversely, in Russia, a notable decline in coal production was recorded with a 4.4% drop in investments by coal companies during the first half of 2024, marking the first six-month downturn since 2020. Meanwhile, the rise of renewable energy in Europe, with Germany’s renewable power mix increasing to 70% from 61% the previous week, continues to exert downward pressure on coal prices.
From the start of 2024, coal prices have decreased by $6.65, or 4.54%, based on trading via a contract for difference (CFD) that tracks the benchmark market for this commodity. Looking ahead, projections indicate that coal is expected to trade at $144.81 per metric tonne by the end of this quarter, with estimates suggesting a price of $148.05 within a year.