BMI View : Despite the environmental benefits of replacing coal with cleaner energy sources, we expect economic imperatives to ensure that coal remains central to the global economy in the coming years. Emerging markets such as China and India will drive demand growth on the seaborne market, as rising consumption outstrips domestic supply. Significant growth in coal trade volumes will present numerous opportunities and challenges for related industries.
In this report, we consider the five 'burning themes' in the global coal industry, which are as follows:
1. Writing On The Wall For US Coal
2. China & India To Crave For More
3. Africa Joins In The Coal Rush...Gradually
4. From Atlantic To Asia-Pacific
5. Panamax Rates In Calmer Waters
We then look more specifically at how these themes will affect the two main segments of the coal industry, namely thermal and coking coal. Our focus on thermal coal details our view for prices to prove resilient in the coming years, despite averaging lower year-on-year for the third consecutive year in 2013. For coking coal, our relatively downbeat forecast for Chinese steel production growth leads us to identify further headwinds for the coking coal industry.