Released December 28, 2020 | SUGAR LAND
en
Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Global coal demand is expected to rise in 2021 after two years of declines, according to Coal 2020, an annual report on the black rock from the International Energy Agency (IEA) (Paris, France). But the agency's overall outlook to 2025, while noting several uncertainties, is that coal demand will mostly go sideways: it is expected to grow in some countries, such as China and India, but that will be offset by falling use in advanced economies like the U.S. and nations in the European Union.
The most critical variable is whether and how soon the world can bring the COVID-19 pandemic under control.
"The COVID-19 crisis has completely reshaped global coal markets," Keisuke Sadamori, the IEA's director of energy markets and security, said in releasing the study December 18. "Before the pandemic, we expected a small rebound in coal demand in 2020, but (instead) we have since witnessed the largest drop in coal consumption since the Second World War. The decline would have been even steeper without the strong economic rebound in China -- the world's largest coal consumer -- in the second half of the year."
China's ability to bring the pandemic under control in its country is a big reason why its gross domestic product (GDP) quickly recovered. In the first quarter of 2020, China's economy contracted 6.8% compared with the year-earlier quarter, according to the International Monetary Fund (IMF) (Washington, D.C.). But China's economy rebounded to grow 3.2% and 4.9% in the second and third quarters, respectively. For 2021, the IMF forecasts China's economy, the world's second-largest, will grow 8.2%, leading to an increased demand for coal.
Ravaged by the pandemic, the global economy will contract an estimated 4.4% in 2020, the IMF predicted. Declining electric demand and industrial activity, coupled with lower-cost natural gas and increasingly competitive renewable energy, will cut this year's coal global demand 5%, the IEA's new report estimated.
But global economic growth and coal use are expected to rise in 2021. The IMF is predicting the world's economy will grow 5.2% in 2021, which the IEA expects will push up coal use 2.6%, to about 7.5 billion tonnes.
As the world's economies go, so goes the demand for coal -- whether it's steam coal for electric generation or metallurgical (met) coal for steel-making and cement production.
Global coal use peaked in 2013 at slightly over 8 billion tonnes, but that fell to roughly 7.8 billion tonnes in 2018, the IEA said. In 2021, demand is expected to be about 7.4 billion tonnes. By 2025, demand for the black rock is expected to hold steady at about 7.4 billion tonnes, the IEA said in Coal 2020.
Click on the image at right to see the IEA's estimate of global coal demand since 2000.
Through 2025, the IEA projects that rising demand for coal in industrializing nations like China, India and Indonesia will offset declines in demand from industrialized nations like the U.S. and the nations of the European Union.
Click on the image at right to see how the IEA predicts demand for coal will rise or fall in different regions around the world through 2025.
As the world's largest producer and consumer of coal, China will have a large say in coal's fate around the world, the IEA said. China's burgeoning demand for thermal coal for power production and met coal for steelmaking offset a decline in the use of thermal coal for home heating in 2019. Demand for met coal remained strong in 2020, despite the pandemic, and next year, the IEA expects strong gains in the use of coal for power production.
Click on the image at right to see IEA's estimated breakdown of China's use of coal in 2019, 2020 and 2021.
The future of coal will largely be decided in Asia, the IEA report asserted. China and India currently account for 65% of global coal demand. Add to that the economies of Japan, Korea, Taiwan and Southeast Asia and that region accounts for an estimated 75% of global coal use. By 2025, however, the European Union and U.S. will account for less than 10% of global coal demand, down from 37% in 2000. Thus, while coal demand is declining in those markets, the trend will have a limited impact on global coal use, Coal 2020 said.
Global production of coal increased 1.5% in 2019, to slightly more than 7.5 billion tonnes, the IEA said. As production outstripped demand, coal stockpiles grew. The agency projected global coal production will decline 6.5% this year before rising to about 7.6 billion tonnes in 2021 in response to increased demand.
Click on the image at right to see the IEA's estimate of global coal production by region from 2018-2021.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
The most critical variable is whether and how soon the world can bring the COVID-19 pandemic under control.
"The COVID-19 crisis has completely reshaped global coal markets," Keisuke Sadamori, the IEA's director of energy markets and security, said in releasing the study December 18. "Before the pandemic, we expected a small rebound in coal demand in 2020, but (instead) we have since witnessed the largest drop in coal consumption since the Second World War. The decline would have been even steeper without the strong economic rebound in China -- the world's largest coal consumer -- in the second half of the year."
China's ability to bring the pandemic under control in its country is a big reason why its gross domestic product (GDP) quickly recovered. In the first quarter of 2020, China's economy contracted 6.8% compared with the year-earlier quarter, according to the International Monetary Fund (IMF) (Washington, D.C.). But China's economy rebounded to grow 3.2% and 4.9% in the second and third quarters, respectively. For 2021, the IMF forecasts China's economy, the world's second-largest, will grow 8.2%, leading to an increased demand for coal.
Ravaged by the pandemic, the global economy will contract an estimated 4.4% in 2020, the IMF predicted. Declining electric demand and industrial activity, coupled with lower-cost natural gas and increasingly competitive renewable energy, will cut this year's coal global demand 5%, the IEA's new report estimated.
But global economic growth and coal use are expected to rise in 2021. The IMF is predicting the world's economy will grow 5.2% in 2021, which the IEA expects will push up coal use 2.6%, to about 7.5 billion tonnes.
As the world's economies go, so goes the demand for coal -- whether it's steam coal for electric generation or metallurgical (met) coal for steel-making and cement production.
Global coal use peaked in 2013 at slightly over 8 billion tonnes, but that fell to roughly 7.8 billion tonnes in 2018, the IEA said. In 2021, demand is expected to be about 7.4 billion tonnes. By 2025, demand for the black rock is expected to hold steady at about 7.4 billion tonnes, the IEA said in Coal 2020.
Click on the image at right to see the IEA's estimate of global coal demand since 2000.Through 2025, the IEA projects that rising demand for coal in industrializing nations like China, India and Indonesia will offset declines in demand from industrialized nations like the U.S. and the nations of the European Union.
Click on the image at right to see how the IEA predicts demand for coal will rise or fall in different regions around the world through 2025.As the world's largest producer and consumer of coal, China will have a large say in coal's fate around the world, the IEA said. China's burgeoning demand for thermal coal for power production and met coal for steelmaking offset a decline in the use of thermal coal for home heating in 2019. Demand for met coal remained strong in 2020, despite the pandemic, and next year, the IEA expects strong gains in the use of coal for power production.
Click on the image at right to see IEA's estimated breakdown of China's use of coal in 2019, 2020 and 2021. The future of coal will largely be decided in Asia, the IEA report asserted. China and India currently account for 65% of global coal demand. Add to that the economies of Japan, Korea, Taiwan and Southeast Asia and that region accounts for an estimated 75% of global coal use. By 2025, however, the European Union and U.S. will account for less than 10% of global coal demand, down from 37% in 2000. Thus, while coal demand is declining in those markets, the trend will have a limited impact on global coal use, Coal 2020 said.
Global production of coal increased 1.5% in 2019, to slightly more than 7.5 billion tonnes, the IEA said. As production outstripped demand, coal stockpiles grew. The agency projected global coal production will decline 6.5% this year before rising to about 7.6 billion tonnes in 2021 in response to increased demand.
Click on the image at right to see the IEA's estimate of global coal production by region from 2018-2021. Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
