BAKU, Azerbaijan, October 24. Due to a robust coal supply and lower natural gas prices, coal prices took a sharp downturn towards the end of 2022, alleviating an unusual period of market tightness, the International Energy Agency (IEA) said, Trend reports.
According to the agency, high prices that prevailed during the energy crisis following Russia-Ukraine war had previously bolstered the financial health of coal mining companies, allowing them to invest in maintaining and sometimes expanding their capacity.
However, the outlook for future demand and prices in the IEA scenarios is, at best, a mixed one.
The Stated Policies Scenario (STEPS) suggests that coal prices in the US will stand at $46 per ton in 2030, and decrease slightly to $41 per ton by 2050. In the EU, coal prices are projected to amount to $67 per ton in 2030, and $69 per ton in 2050. In Japan and China, coal prices are more elevated throughout the forecasted period. As such, China's coal is expected to trade at $96 and $80 per ton in 2030 and 2050, respectively. Japan may see a significant decline in coal prices from $98 per ton in 2030 to $77 in 2050.
Thus, the STEPS scenario provides some temporary relief for coal producers, but demand decreases in all scenarios, and prices gradually approach the operating costs of existing mines, with the steepest decline occurring in the Net Zero Emissions by 2050 Scenario (NZE), the agency added.
