India's energy ambitions are pushing global coal prices. India's import of coal from South Africa is expected to go up big time in the coming days.
According to reports, South Africa's Richards Bay Coal Terminal, the world's biggest coal export facility, will be shipping huge quantity of coal to India this year, causing a price rice across the globe.
India has become the major importer now and the increased demand from India has lifted the prices in the international market.
Richards Bay Coal Terminal shipped 7.3 million tonnes to India in the first 10 months, compared with 300,000 tonnes for the whole of last year. It may go up by another 2 million tonnes before the end of the year.
Benchmark prices for thermal coal, used in power plants, have reached a record in Australia, South Africa and
Europe in the last three weeks.
According to Sushil Kumar Shinde, Union power minister, India will add 78,755 MW of capacity in the 11th Plan period ending in 2012.
According to experts, India is the market the world is looking at. Richards Bay, which has about 3.5 million tonnes of coal stockpiled at the moment, is owned by mining companies including BHP Billiton and Anglo American. The jump in prices is encouraging European utilities to buy supplies from the US. The power producers are paying more for the shipping than for the coal. Additional demand is also coming from Japan and South Korea.
More than a quarter of western Europe's thermal coal is shipped from Richards Bay, which reported total shipments of 66.5 million tonnes last year. Exports through October this year were 53.8 million tonnes.
