The significant news of last week is that Glencore will temporarily close its Australian coal mines over Sep-Oct, resulting in around 7-mn tons of production being cut, with some also coming from the closure of its Prodeco mine in Colombia.
This helped NEWC prices to rally although near term spot cargoes were still offered OTC at less than $50/t. Perhaps the market has become too used to Glencore being the leader when it comes to “producer discipline”.
In more bullish news, continued heavy rainfall is impacting on coal mine production in both Shaanxi and Shanxi provinces whilst Typhoon Hagupit led to delays in coal handling at some Chinese ports.
However, the impact on prices was negligible due to prevailing high stock levels at Chinese coastal power plants.
Meanwhile, Global Energy Monitor’s Global Coal Plant Tracker reports that the world’s coal-fired fleet capacity reduced for the first time on record in the first half of 2020, down by some 2.9GW, as more coal stations shut than were opened.
Reasons given are “slower commissioning” due to Covid-19 and record retirements in the EU in response to stronger pollution regulations.
In South Africa, environmental campaigners won their appeal to scrap two water use licences granted to Saudi Arabia’s ACWA Power to develop the 600MW capacity Khanyisa coal-fired power station.