Commodity Market Report

Thermal coal markets short-term outlook April 2021

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30 April 2021

Thermal coal markets short-term outlook April 2021

Report summary

Both Australia and Indonesia made their comebacks to the exports market in April after the flooding and infrastructure issues. However, prices have responded differently due to varying demand dynamics and policy impact across regions. A resurgence in coronavirus infections in India, new 17-day lockdown in Japan, potential voluntary cut at coal plants in South Korea, higher carbon and lower gas prices in Europe all add downside pressure to high CV demand and prices in the near term. On the other hand, China demand have continued to surpass expectation, providing strong support to Indonesia prices in the near term. The China coal ban is the largest single uncertainty. It is hard to see an ease in trade tensions between China and Australia anytime soon. Newcastle high ash discount compared to its peers will remain high until we see a silver lining.

Table of contents

  • General discussion and base case
  • High/low scenarios
  • China – high domestic price leads to more seaborne import in next couple of months
  • India – demand remains upbeat, but downside expected in near term
  • Japan – reintroduced state of emergency pressures coal demand into May
  • South Korea – more anti-coal policy brings uncertainty to the near-term growth
  • Australia – exports recover in April; BHP NSW coal tumbles to 11-year low in Q1
  • Indonesia – production and exports both set to increase
  • Canada – Vista receives approval amendments allowing mine restart
  • Colombia – Government holds Glencore to Prodeco obligations
  • Russia – production and exports strong despite the government’s forecast downgrade
  • US – Exports and domestic demand increase

Tables and charts

This report includes 9 images and tables including:

  • FOB price differentials (energy-adjusted)
  • NEWC HA delivered to S.China vs CFR S.China HA
  • Key prices - history and forecast (nominal, US$/t)
  • Low and high cases for Newcastle 6,000 kcal/kg at confidence intervals of 5%, 33%, 66% and 95% (US$/t)
  • Japan monthly power generation (2019-2021YTD)
  • Japan monthly thermal coal imports (Mt)
  • Australia thermal coal exports
  • Australia thermal coal trade flow change YTD comparison (Jan-Feb)
  • Indonesia production and exports

What's included

This report contains:

  • Document

    Thermal coal markets - short-term outlook data - April 2021.xlsx

    XLSX 488.64 KB

  • Document

    Thermal coal markets short-term outlook April 2021

    PDF 989.35 KB