IEA: Global coal demand expected to hit record high in 2024

• China, India's coal demand may edge up y-o-y
  
  
• Power sector to drive growth in consumption
  
  

Mysteel Global: Global coal demand will touch a record high of 8.77 billion tonnes (bnt) this year, the International Energy Agency (IEA) predicts in its Coal 2024 report. The forecast represents an upward revision from the agency's estimate in December last year that global demand would peak in 2023 at 8.54 bnt.

Notably, the power generation sector will mainly drive growth in coal demand, with electricity output from the fossil fuel hitting an all-time high of 10,700 terawatt hours (TWh) this year.

However, the increase in demand is expected to moderate to 1% in 2024 compared with previous years. Growth soared by 7.7% in 2021, by a slightly slower 4.7% in 2022, and by 2.4% last year.

The report also predicts that global coal demand will likely plateau in the next three years and reach 8.87 bnt by 2027. During this period, China - the world's largest coal consumer - will continue to define global trends, with its diversification of power sources in the shape of new energy facilities and hydropower driving structural changes in its energy mix. Additionally, the use of coal-fired power stations in India, Indonesia, and Vietnam will increase further, to meet the higher electricity consumption powered by strong economic growth.

This year, China's coal demand may hit a new record high of 4.9 bnt, higher by 1% y-o-y, while that of India will likely rise by more than 5% to 1.3 bnt. Conversely, the decline in the European Union and the US will continue, slowing this year to 12% and 5% y-o-y, respectively, compared with last year's falls of 23% and 17%, the IEA says.

On the other hand, global coal production is expected to reach an all-time peak of more than 9 bnt this year, with output among the top three producers - China, India, and Indonesia - reaching record highs. China and India will see y-o-y rises of 1% and over 7%, respectively, in their coal output this year, while Indonesia's volume may surpass 800 million tonnes (mnt) for the first time, compared with 775 mnt of realised output last year.

This year, robust demand will push international coal trading, including for thermal and metallurgical grades, to a new high at 1.55 bnt, the IEA estimates. By country, coal imports by China may exceed 500 mnt in 2024, compared with last year's 474.4 mnt. For India, its coal imports may stay basically flat from the 2023-level amid its push for higher domestic production to reduce reliance on imports.

Note: This article has been written in accordance with a content exchange agreement between Mysteel Global and BigMint.