- Write by:
-
Friday, July 9, 2021 - 19:42:33
-
741 Visit
-
Print
Mining News Pro - The surging, post-pandemic U.S. economy is driving an unexpected boom in coal, the latest sign that demand for the dirtiest fossil fuel remains resilient.
American coal production this year will swell 15% to meet stronger demand for electricity at home and abroad, according to the U.S. Energy Department’s July outlook. That would be the most since at least 1990 and nearly double the 8% increase projected in May, when the economic rebound was still in earlier stages of recovery.
The shift underscores the vicious circle of climate change as more extreme temperatures drive power demand just as extensive drought cuts output from hydropower dams. That prompts utilities to burn more of the dirtiest fossil fuel, a pattern also exacerbated by high natural gas prices. At the same time, key exporters including Australia and Colombia face supply problems that have helped lift global prices to a 10-year high and added to international demand for U.S. coal exports.
“Everything that could happen that’s positive from the demand standpoint is happening,” said Andrew Cosgrove, a mining analyst with Bloomberg Intelligence. “The stars are aligning.”
That growing appetite will help boost U.S. exports of the fuel by 21% this year, and another 19% in 2022, the Energy Department said Wednesday in its latest short-term outlook report. The department said its projections are based on forecasting firm IHS Markit’s projection that the world’s largest economy will grow by 7.4% in 2021.
The outlook also is driving up mining company share prices. Peabody Energy Corp., the biggest U.S. coal producer, and rival Arch Resources Inc. both hit 18-month highs this week. Consol Energy Inc. is trading near the highest since August 2019.
And the coal boom is unlikely to lose momentum anytime soon. As long as economic growth remains robust, so too will energy demand, according to Lucas Pipes, an analyst at B. Riley Securities.
Even though the fuel faces strong headwinds in the U.S. and Europe, where efforts to curb climate change are prompting utilities to close coal-fired power plants, global consumption is still increasing because of demand in Asia. And because suppliers aren’t opening new mines, prices are likely to remain high.
“I’m not seeing any changes in these trends,” said Pipes. “It bodes well for coal.”
Short Link:
https://www.miningnews.ir/En/News/614922
Oxford Economics Australia has released data showing mine maintenance spending may be hitting its peak. But what does it ...
Iron ore futures fell to their lowest in more than two weeks, pressured by an inventory accumulation at Chinese ports ...
Japan’s top steelmaker, Nippon Steel, is sticking to its plan to close a deal by year-end to buy US Steel, which it ...
Nutrien, the world’s biggest fertilizer producer, beat first-quarter profit estimates on Wednesday, on strong demand for ...
Copper briefly traded through $10,000 a ton as investors raised bets on Federal Reserve rate cuts, and Goldman Sachs ...
Albemarle, the world’s largest producer of lithium for electric vehicle batteries, could look at reducing capital ...
Coal India Ltd., the world’s largest producer of the commodity, reported a 26% increase in fourth-quarter profit, driven ...
Emerging North American gold producer Contango ORE is boosting its landhold in Alaska with the acquisition of Canada’s ...
Gold fell, with market watchers saying the previous day’s rally in response to Federal Reserve Chair Jerome Powell’s ...
No comments have been posted yet ...