According to Drewry research analysts, a wave of carbon footprint reduction flows around the world. The main coal consuming countries are looking to reduce the consumption of coal. Many EU countries are now part of the Power Past Alliance, with the aim of accelerating the coal transition.
For example, the Netherlands plans to eliminate coal by 2030 and the United Kingdom and Italy intend to do the same by 2025. In India, the government plans to reduce the share of coal in electricity consumption by 10% in the next five years. In similar lines, China aims to reduce the share of coal in the energy mix by 5% -6% over a similar period, Drewry said.
The emphasis on curbing coal consumption is now visible, as the growth of coal imports has slowed over the past five years, and coal trade has grown to a CAGR (compound annual growth rate) of only 1.1. % in 2012-2017. Imports of the main Asian importers (Taiwan, China, South Korea, India and Japan), which account for more than 60% of world imports, increased by 0.3% during 2012-17, while during the 2007- 2012 increased to a CAGR of 12% Elsewhere, EU imports decreased dramatically during 2012-17, dampening the growth of world trade. While the EU is determined to eliminate coal, the declining cost of renewables is making green technology a viable option for developing countries in Asia.
Emerging carbon consumers
However, there is a group of Asian countries: Malaysia, the Philippines, Thailand, Vietnam and Pakistan, where the consumption of coal is increasing steeply. The increase in imports of these emerging consumers provides support to the coal trade. Combined coal imports from these countries increased at a compound annual rate of 9.9% between 2012 and 17.
The increase in consumption by ’emerging importers’ will support imports of coal
Both Malaysia and Thailand depend almost entirely on imports for coal consumption. Therefore, there will be an approximately one to one increase in the consumption and imports of coal.
