Coal’s Resilience Will Be Its Downfall – by David Fickling (Bloomberg News – December 20, 2017)

Consider the following events this month:

  • Newcastle, the Australian port that’s the biggest export harbor for thermal coal, is planning a shift away from the commodity that generates the overwhelming majority of its trade volumes
  • BHP Billiton Ltd., one of the world’s largest coal miners, is considering quitting the industry’s global trade body and perhaps the U.S. Chamber of Commerce because it can’t reconcile its policies on climate change and energy policy with their more coal-friendly stances
  • National Australia Bank Ltd. promised not to lend to new thermal coal projects and ING Groep NV pledged to reduce its exposure to coal generators to close to zero by 2025

  • China Merchants Bank Co. joined the lengthening line of lenders disavowing advances for Adani Enterprises Ltd.’s Carmichael project, one of the largest such developments worldwide but one that’s highly unlikely to go ahead
  • South Korea, one of the world’s biggest coal importers, announced plans to phase out coal by 2079 and sharply cut its use by 2030
  • The International Energy Agency said that coal demand would remain essentially flat until 2022 — particularly striking given that in recent years it has tended to overestimate coal’s prospects

You’d think from this newsflow that the main benchmark for globally traded coal would be wilting. In fact, it’s been on a tear.

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