Askume LITTLETON, Colo., Sept 17 — The United States shipped a record 6.1 million tonnes of thermal coal, mainly used in power generation and industrial boilers, in the first eight months of 2024, according to Kepler ship tracking data.
This total represents an 83% increase from the same period in 2023 and ensures that the United States will remain by far Africa’s largest thermal coal supplier in 2024, accounting for a record 64% of Africa’s total thermal coal imports.
Exports to Africa helped push total US coal exports to the third highest on record in the first eight months of this year, along with 11.1 million tonnes to Asia, America’s biggest coal market.
Continued high levels of coal exports undermine US and global efforts to reduce the use of coal in electricity generation because coal emissions from generating electricity have increased significantly compared to other fossil fuels.
The continued rise in US coal exports has raised the risk of a backlash from international climate advocates, who want the US to take a leading role in efforts to curb the sale and use of coal.
Top Marketplaces
As of September, this is the second consecutive year that US exports have exceeded 22 million tons, meaning the country’s annual coal exports are expected to be the second or third highest in coal export history.
Kepler data shows the country’s coal exports reached a record high of 39.1 million tonnes in 2018 and are unlikely to recover into 2024.
The biggest overall market for U.S. thermal coal this year is India, which imported 7.3 million tons from January through August. India is the world’s second-largest user of coal for power generation after China.
Morocco and Egypt are the second-largest markets for US coal this year, importing 3 million tonnes and 2.9 million tonnes, respectively, through August.
So far this year, China (1.8 million tons), the Netherlands (1.4 million tons) and Japan (875,000 tons) are the next-largest destinations for US coal.
Africa Grows Up
Kpler data shows that African countries imported a total of 9.48 million tonnes of thermal coal from January to August.
The total was 0.5% lower than the same month in 2023 but was the continent’s third-largest on record, highlighting Africa as a key market for coal exporters.
Africa’s imports have increased by 12% over the past two years, and Africa is the only major region other than Asia to see an increase in thermal coal imports from 2022 onwards.
Imports from Europe, North America and Oceania fell by at least 20% during this period.
Morocco is Africa’s biggest coal importer and mainly uses coal to generate electricity, Ember said. About 64% of the country’s electricity comes from coal.
Egypt has no coal-fired power plants, but thermal coal is used in cement production and other industrial processes that require cheap heat.
South Africa is by far Africa’s largest coal consumer, but importing countries are relatively small due to high local coal production.
Zimbabwe, Botswana and Zambia are other important industrial and power consumers of coal in Africa, but all are landlocked and supplied mainly by trucks from South Africa or locally produced coal.
Niche markets?
This means that Morocco and Egypt in North Africa are the most viable options for seaborne coal exporters looking to expand their market share in Africa.
These countries are particularly attractive to US suppliers because they can reach the region’s coal ports via a relatively easy trip across the Atlantic.
According to LSEG, travel times for bulk coal shipments from Baltimore, the major US coal export port, to Morocco’s Casablanca Bulk Terminal were less than 11 days.
The trip is about a week shorter than to South Africa, thus meaning that North American sellers can serve Moroccan buyers faster than miners from the same continent.
US exporters can ship coal to Morocco faster than Colombian and Russian sellers and are therefore set to remain Morocco’s main supplier. According to Kpler, Morocco imports about 750,000 tonnes of thermal coal each month.
The voyage from Baltimore to Egypt is six days long, so commitments to American exporters are longer.
Kpler data shows that Egypt’s average import tonnage is also significantly lower than Morocco’s, with monthly imports of around 400,000 tonnes by 2024.
However, average monthly imports are 100,000 tonnes higher than in 2023, indicating that overall coal demand in Egypt has increased by more than 30% so far this year.
In comparison, Morocco’s monthly demand for thermal coal is around 8% below the 2023 average, thus indicating that Morocco’s total coal demand may have peaked.
Egypt is a rare bright spot for coal exporters looking to maximize sales and a potential entry point for other fast-growing economies in North Africa that need cheap electricity and industrial fuel.
These development trends may contradict the US’s stated ambition to reduce global coal consumption.
But as long as international coal demand exists, US exporters will be able to meet it, especially in neighboring markets.
<The views expressed here are those of the author, a Askume columnist.
The views expressed are solely the author’s own. They do not reflect the views of Askume News, which is committed to integrity, independence and non-partisanship in accordance with the principles of trust.
