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S Africa’s reliance on coal to continue: Minister

South Africa's economy will remain dependent on coal for the foreseeable future despite the implementation of stricter environmental regulations, said mineral resources and energy minister Gwede Mantashe.

"Coal will remain the mainstay of South Africa's energy basket for the next 10 to 20 years," Mantashe said yesterday.

State-owned utility Eskom's new coal-fired power plants, Medupi and Kusile, and independent providers of coal-fired power will sustain the coal industry, he said.

The minister made the remarks at an engagement with the chief executive officers of coal mining firms operating in South Africa. The engagement focussed on the coal sector's challenges, with the aim of finding ways to ensure industry growth and sustainability.

The coal sector will remain a critical component in the country's energy mix for three main reasons, according to Mantashe.

Firstly, South Africa is "highly endowed" with coal, the minister said. South Africa's mineral preliminary gross in-situ value is estimated at $9.6 trillion, of which over 43pc are coal resources, followed by PGM's (31.5pc) and gold (11.7pc).

Secondly, South Africa is highly dependent for its baseload and energy security on coal-generated power. Thirdly, the coal mining and power generation sectors "generate massive revenue and employ thousands of employees", the minister said.

In South Africa, it accounts for 70pc of primary energy consumption, 95pc of electricity generation and about 30pc of petroleum liquid fuels. Coal is also an essential element in the production of iron, steel and ferroalloys and cement, as well as other industrial and manufacturing sectors.

Global coal consumption is expected to continue to rise in the medium term, driven by demand from developing nations in Asia, Africa and South America that will offset declining consumption in Europe and the US.

India, currently South Africa's biggest coal export market, has voluntarily undertook to cut its greenhouse gas (GHG) emissions intensity. But so far, South African coal exports to India — which currently account for half of total export revenues — remain unaffected, Mantashe pointed out.

Strong international coal prices of around $130/t have raised the attractiveness of exports, he said.

Pakistan, Malaysia, Taiwan, and Bangladesh also offer potential exports growth. But there is no scope for further growth in the European Union, because of environmental laws, the minister conceded.

The coal sector produced around 248mn t of coal in 2020, according to the DMRE. Coal was the highest revenue earner, contributing 21.4pc of the mining sector's total revenue of R608.99bn ($39.72bn). The coal sector was also the highest earner of domestic sales revenue and contributed 53.42pc of a total of R159.16bn. The sector generated 10.13pc of total foreign-exchange earnings of R449.83bn.

In addition, coal was the third-largest employer in the mining industry after precious metals and PGMs, directly employing 89,548 people, which represented 20.48pc of total mining industry employment. These employees received over R30.71bn in wages and salaries, which constituted just over 20.27pc of the mining industry's total wage income.

But the implementation of stricter environmental laws in South Africa will adversely affect the electricity sector, liquid fuels manufacturing, and the iron and steel industry, Mantashe warned. Together these three sectors account for more than 80pc of domestic coal demand in terms of value and around 70pc in volume, he said.

"For developing nations like South Africa, coal is a very affordable source of primary energy and abundantly available," Mantashe said.

But it faces several challenges, not least among them, increasing pressure from financial institutions and green energy advocates, as coal is a major contributor to GHG emissions, he said.

However, a pursuit of the Cop 26 agenda cannot afford to wholly ignore South Africa's national interests, the minister stressed. Instead, Cop 26 commitments should be integrated into national development plans "serving our interests as it is with all other states bargaining the global trajectory of climate change", he said.

Published by Argus Media, 2 February 2022

This month's top international coal headlines

  • Apr thermal coal derivative volumes down 34% at 26.6Mt: LEBA — Platts CTI
  • Asian thermal coal prices rise as demand from India holds — Platts CTI
  • RB prices steady while India eyes cheaper supplies
    — Southern African Coal Report
  • Will Transnet be the next Eskom? Industry warns rail is in free fall in SA
    — News24
  • Time's up - overhaul of SA's energy policy needed 'as in yesterday', Eskom warns — News24
  • CME April coal traded volumes drop 40% to record-low 5.8Mt — Platts CTI
  • South Africa March coal exports down 5% to 5.8Mt: customs data — Platts CTI
  • Industry frustrations boil over at South African coal conference
    — Southern African Coal Report
  • Richards Bay rises with July trade — Southern African Coal Report
  • RB prices under pressure from weak Pakistan, India demand
    — Southern African Coal Report
  • Botswana’s Morupule rails first coal exports to Maputo port
    — Southern African Coal Report
  • India halts passenger trains to free up track to move coal — Al Jazeera
  • Gwede Mantashe’s supporters want Eskom CEO André de Ruyter fired
    — MyBroadband

2022 archive

April 2022
  • Turkey's thermal coal imports fall 34% on year to 1.8Mt in Mar
    — Southern African Coal Report
  • Atlantic thermal coal prices fall sharply throughout week — Platts CTI
  • Asian thermal coal markets at standstill ahead of Labour Day holiday
    — Platts CTI
  • Indian seaborne interest lifts Indonesian thermal coal sentiment — Platts CTI
  • Pakistan turns to Afghan, Tajik coal to replace expensive S African — Platts CTI
  • RB prices find further support from Europe, India
    — Southern African Coal Report
  • Transnet coal railings worsen, exports could fall below 2021
    — Southern African Coal Report
  • Months before coal market upheaval settles – Euracoal — Montel
  • Spanish Jan-Mar coal-fired generation doubles on year
    — Southern African Coal Report
  • Buyers look to replace South African coal amid logistical issues, record high prices — Platts CTI
  • Atlantic thermal coal prices remain rangebound close to record highs
    — Platts CTI
  • South Africa coal exports to EU jump 10-fold in April
    — International Centre for Sustainable Carbon
  • Pakistan looks for alternatives as South African coal remains out of bounds
    — Platts CTI
  • South Africa's Transnet declares force majeure, may junk long-term contracts — Platts CTI
  • RBCT spared as floods hit KwaZulu-Natal road and port infrastructure
    — Southern African Coal Report
  • Transnet declares FM as it seeks to amend long-term rail contracts
    — Southern African Coal Report
  • Ernie Thrasher: There’s no escaping geopolitics when it comes to coal markets — Southern African Coal Report
  • RBCT: Transnet terminates coal export agreements — Mining Review Africa
  • Sentiment for Australian thermal coal bullish on demand from East Asia, Europe — Platts CTI
  • European coal reaches one-month high as Russia supply curbs bite — Reuters
  • China Mar coal imports soar 46.24% on month, GAC — sxcoal.com
  • Transnet declares force majeure on coal contracts, Thungela says — Reuters
  • German utilities scramble for Russian coal alternatives — Platts CTI
  • TFR CEO eyes 'significant improvement' in coal railings — Platts CTI
  • CIF ARA, FOB RBCT prices hit fresh record highs — Platts CTI
  • Coal output at South Africa’s Thungela falls in 2021 — Platts CTI
  • Europe's sanction on Russian coal fosters call of duty toward energy transition — Platts CTI
  • Asian thermal coal prices ease as buyers remain on side-lines — Platts CTI
  • Richards Bay March exports to Europe surge fivefold
    — Southern African Coal Report
  • RB prices set to rise further on EU ban of Russian imports
    — Southern African Coal Report
  • Investors pile into coal shares as price prospects shine
    — Southern African Coal Report
  • SA to see huge gains from EU ban on Russian coal
    — Southern African Coal Report
  • March thermal coal derivative volumes surge to three-year high: LEBA
    — Platts CTI
  • Atlantic thermal coal prices jump on Russian import ban — Platts CTI
  • EU's full ban on Russian coal to be pushed back to mid-August-sources
    — Reuters
  • EU officials agree Russian coal ban, formal announcement Friday
    — McCloskey Coal Report
  • CME March coal volumes rebound 40% on month to 12Mt — Platts CTI
  • Indonesian thermal coal offers edge higher despite tepid Chinese seaborne demand — Platts CTI
  • European coal prices jump on Russian import ban proposal, German importers prepared — Platts CTI
  • Eskom’s just energy transition project pipeline investments to cost more than R180bn — Mining Weekly
  • Bureaucracy and anti-mining lobbies stifling South Africa’s growth prospects
    — Mining Weekly
  • Bayoglu unconvinced the energy transition will benefit the majority
    — Mining Weekly
  • Asian thermal coal sentiment bearish as buyers reluctant to pay high prices
    — Platts CTI
  • RB prices steady in tight market, Indian demand supports
    — Southern African Coal Report
  • South Africa February coal exports fall 3% to 5.4Mt: customs data — Platts CTI
  • Vietnam considers South Africa, Colombia to plug coal supply gap
    — McCloskey Coal Report
  • Europe steps up efforts to halt Russian coal, energy imports
    — McCloskey Coal Report
  • Indian import demand increases with SA, Indonesia deals
    — McCloskey Coal Report
  • Atlantic thermal coal pricing relatively steady amid Russian disruptions
    — Platts CTI
March 2022
  • RB prices under pressure as global supply fears subside
    — Southern African Coal Report
  • SA non-RBCT coal exports could soar 50% this year — McCloskey Coal Report
  • Germany faces energy security struggle without Russian coal
    — McCloskey Coal Report
  • Russian coal exports likely to drop 16% as Europe seeks alternatives
    — McCloskey Coal Report
  • Mediterranean buyers seek Colombia coal amid Russia, South Africa shortage — Platts CTI
  • Atlantic thermal coal prices volatile as buyers avoid Russian coal — Platts CTI
  • Thungela resources coal production falls to 15 million mt in 2021 — Platts CTI
  • Asian thermal coal sentiment dulls amid elevated prices — Platts CTI
  • SA’s Thungela sees 2022 exports steady at 14-15Mt on rail issues
    — Southern African Coal Report
  • Rail issues force Exxaro to truck Waterberg coal for export
    — Southern African Coal Report
  • Namibia’s Walvis Bay exports first coal cargo amid high prices
    — Southern African Coal Report
  • Asian thermal market activity dulls as buyers reluctant to pay higher prices
    — Platts CTI
  • Germany faces energy security struggle without Russian coal
    — McCloskey Coal Report
  • New realism set to slow energy transition, extend thermal generation: ContourGlobal — Platts CTI
  • Coal - Grappling with the 'Bad Boy' image — Mitra SK Coal & Carbon
  • S Africa’s reliance on coal to continue: Minister — Argus Media
  • Indian traders look to offload off-spec cargoes — Argus Media
  • Off-spec South African coal rises above API4 — Argus Media
  • Green Germany Weighs Reopening Coal Power Plants amid Energy Crisis
    — Breitbart
  • S Korea thermal coal imports rise 20% to 7.6Mt in Feb — Platts CTI
  • Chinese thermal coal demand tapers off as COVID-19 lockdowns hit again: sources — Platts CTI
  • Asian thermal coal prices ease amid softening demand from Europe
    — Platts CTI
  • South African coal output falls 8% in 2021 to 228.6Mt — IHS Markit
  • RB prices drop from record highs as EU keeps Russia door open
    — Southern African Coal Report
  • Richards Bay May cargo trades lower — IHS Markit
  • Germany woos South Africa to replace Russian coal — Montel
  • Atlantic thermal coal prices hit fresh records as supply shortage persists
    — Platts CTI
  • Asian thermal coal prices extend gains amid bullish demand in Europe
    — Platts CTI
  • Job ads hint Spain’s Los Barrios to run for at least 9-12 months — IHS Markit
  • CME February coal volumes rebound 53% on month to 8.2Mt — Platts CTI
  • Feb thermal coal derivative volumes rise 12% to 50.6 million mt: LEBA
    — Platts CTI
  • RB prices continue record rally on Russia-Ukraine conflict
    — Southern African Coal Report
  • Atlantic exporters set sights on Europe, ramp up output
    — McCloskey Coal Report
  • Non-Russian exporters race to fill European coal void, SUEK declares FM
    — IHS Markit
  • Med-delivered coal prices hit historic highs amid Russia-Ukraine conflict
    — Platts CTI
  • European coal consumers seek alternative supply to Russia material
    — Platts CTI
  • Robust European demand pushes Richards Bay 5,500 kcal/kg NAR coal to premium — Platts CTI
  • Pakistan thermal coal price hits historic high amid surging RB rates
    — Platts CTI
  • Atlantic thermal coal prices jump to record highs on Ukraine conflict
    — Platts CTI
  • European power utilities start bidding for SA coal — Moneyweb.co.za
  • China backpedals on climate promises as economy slows — News24
  • Oil Jumps Back Above $100 as Russia Casts Doubt on Ukraine Talks
    — Bloomberg
  • South African January coal exports rise 43% to 5.3 million mt: customs
    — Platts CTI
  • SA prices at record high, buyers scramble to replace Russian coal
    — Southern African Coal Report
  • Wescoal to shut Vanggatfontein Colliery after Eskom deal falls through
    — Southern African Coal Report
February 2022
  • PAKISTAN DATA: 2021 thermal coal imports up 15% on year to 16Mt
    — Platts CTI
  • Russia’s invasion of Ukraine may trigger gas-to-coal switching, lift carbon price: expert — Platts CTI
  • Pakistan thermal coal price hits new high amid supply risk — Platts CTI
  • Atlantic thermal coal prices surge on Russia military advance on Ukraine
    — Platts CTI
  • Supply tightness supports Asian thermal coal prices, seaborne trades thin
    — Platts CTI
  • Coal prices jump as sanctions ratchet up on Russia — IHS Markit
  • Coal throughput at Rotterdam rises 42% in 2021 to 24.6Mt — Platts CTI
  • Europe facing 'necessity' to ensure energy supply despite Ukraine conflict, LNG insufficient: CEOs — Platts CTI
  • Russian invasion pushes seaborne prices — IHS Markit
  • China approves 3 new coal mines with total capacity of 19Mtpa — sxcoal.com
  • What challenges the global coal market face amid escalated Russia-Ukraine conflict? — sxcoal.com
  • Taiwan Dec thermal coal imports reach 4.6Mt, up 15% on year — Platts CTI
  • Volatility mars Richards Bay prices amid geopolitical tensions
    — Southern African Coal Report
  • New ops model, security measures to push SA coal exports to 78Mt in 2022
    — Southern African Coal Report
  • Indonesian thermal coal prices edge lower amid tepid seaborne demand from China — Platts CTI
  • Atlantic thermal coal prices relax but supply issues persist — Platts CTI
  • Richards Bay stocks rise to 4-month high but port congestion worsens
    — IHS Markit
  • China ramps up coal supply to power plants — sxcoal.com
  • India aims to be self-dependent in coal supply to power plants by 2024
    — sxcoal.com
  • Transnet seeks R3bn for tech security to thwart cable theft — fin24
  • Indonesian thermal coal demand softens on bearish China interest
    — Platts CTI
  • SA mine production dragged down by coal again
    — Southern African Coal Report
  • RB prices back above $200/t FOB on tight global supplies
    — Southern African Coal Report
  • Europe’s energy market: Torn between cost and climate — IHS Markit
  • The Harsh Realities of Clean Energy Transformation — Bloomberg Law
  • Coal Will Remain Prominent for Decades Despite Growing Renewable Power Capacity — Powermag.com
  • Atlantic thermal coal prices surge as prompt supply remains tight — Platts CTI
  • Destabilising coal usage in SA will cripple our economy — EWN
  • Supply tightness in Asian thermal coal markets firms spot prices — Platts CTI
  • Glencore’s SA coal output drops 17% in 2021 — Southern African Coal Report
  • Western coal phase-out funds unlikely to start flowing to SA this year
    — Southern African Coal Report
  • Could declining demand in the United States push down international prices
    — IHS Markit
  • Cracking down on methane 'ultra-emitters' is a quick way to combat climate change, researchers find — The Washington Post
  • CME January coal volumes fall 72% on year to 5.8Mt — Platts CTI
  • Queensland power grid to struggle with heatwave conditions
    — Brisbane Times
  • Remarks by the honourable Minister of Mineral Resources and Energy Mr Gwede Mantashe on the Coal Colloquium 01 — Govt of SA
  • Richards Bay Coal Terminal hopes for massive railing recovery in 2022
    — Southern African Coal Report
  • RB surpasses $200/t, Indian buyers' eye lower off-spec cargoes
    — Southern African Coal Report
  • South Africa 2021 total coal exports down 14% on year to 63Mt: customs
    — Platts CTI
January 2022
  • Atlantic thermal coal prices rally to multi-month high on Russian supply issues — Platts CTI
  • Billions lost as coal exports hit multi-decade lows — News24
  • Asian thermal coal prices bullish on strong Chinese demand, tight supply
    — Platts CTI
  • South Africa's RBCT exports lowest coal tonnage since 1996 — Mining Weekly
  • Botswana's Minergy evaluating coal export options to Mozambique, Namibia — Platts CTI
  • Firm seaborne demand amid lack of barges pushes up Indonesian thermal coal prices — Platts CTI
  • Richards Bay price hovers at three-month high — Southern African Coal Report
  • Eskom to burn more coal this year as green energy projects stall
    — Southern African Coal Report
  • Botswana-based coal miner Minergy nears target capacity of 125,000 t/month — Platts CTI
  • Atlantic thermal coal prices volatile amid numerous supply issues — Platts CTI
  • Coal India pledges to meet domestic demand, bridge seaborne supply gap
    — sxcoal.com
  • Australian thermal coal prices continue to simmer in absence of Indonesian offers — Platts CTI
  • India's thermal coal imports slump about 47% on year in Dec — Platts CTI
  • Taiwan November thermal coal imports up 21% on year at 6Mt — Platts CTI
  • The Great Supply Chain Disruption: Why it continues in 2022 — IHS Markit
  • Indonesia's export ban pushes up prices of other origin thermal coal
    — Platts CTI
  • Richards Bay prices rally on strong spot buying from India
    — Southern African Coal Report
  • Mantashe says DMRE committed to pursuing energy mix that ensures security of supply — Mining Weekly
  • Egypt's 2021 thermal coal imports rise 30% on year: POA — Platts CTI
  • Atlantic thermal coal prices rally, Russia to buy back tonnage: trade
    — Platts CTI
  • Australian thermal coal extends gains amid Indonesia's export ban
    — Platts CTI
  • Thermal coal derivative volumes down 27% in 2021 to 560Mt: LEBA
    — Platts CTI
  • Seaborne thermal coal demand firms in ex-China markets amid Jakarta export ban — Platts CTI
  • A strong rebound in 2021 and slow growth thereafter lead to highest ever global coal demand by 2024 — International Energy Agency
  • RB prices to find support from emerging Indian demand
    — Southern African Coal Report
  • PAKISTAN DATA: October thermal coal imports up 18% on year to 1.8Mt
    — Platts CTI
  • Australian thermal coal prices gain steam amid Indonesia's ban on exports
    — Platts CTI
  • Coal power surged to a record high in 2021, pushing up emissions
    — International Energy Agency
  • Atlantic markets rebound sharply on colder weather, Indonesia ban
    — McCloskey Coal Report
  • Indonesian export ban paralyses spot thermal market
    — McCloskey Coal Report
  • IEA sees record high global coal demand, output in 2022
    — McCloskey Coal Report
  • Atlantic thermal coal prices make significant gains to start year — Platts CTI
  • Indonesian coal miners seek exemption from export prohibition — sxcoal.com
  • France plans to raise cap on coal burn in Jan-Feb — sxcoal.com
  • French nuclear woes lift December coal, gas burn across Europe — Platts CTI
  • Commodities 2022: New investment projects set to start as UK aims for higher energy stability — S&P Global Platts

2021 archive



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