Annual Report 2010 - Verein der Kohlenimporteure eV

therefore has the potential to increase its exports to
Europe in 2011. Venezuela will remain a constrained
supplier in terms of volume for the foreseeable future.
Coking Coal Market – Signs Remain
“Bullish”
Demand
The positive trend in the steel sector continued during
the first months of 2011. All steel-producing countries
have increased their pig iron production. The increased
demand for coking coal has already led to price
increases. As especially China and increasingly India
are continuing to raise their steel production, largely
based on pig iron, and OECD countries produce more,
the coking coal market in 2011 could grow by 10-12%
or 25-30 million tonnes compared with 2010.
Supply
In addition to the traditional supply sources, the first
deliveries from the Elgen project in Russia and from
the Vale project in Mozambique could occur in 2011
and extend the pool of suppliers in 2011. The high price
level is also likely to encourage the expansion of coking
coal mines around the world, while new coking coal
projects are being examined in Indonesia, Mongolia and
Colombia. Mozambique could begin exporting from
the Moatize pit in 2011; it is under construction and has
been designed for a production of 11 million tonnes per
annum, of which 8.5 million tonnes is coking coal and
2.5 million tonnes steam coal.
Australia, the USA and Canada continue to be the major
suppliers to the global market. They will presumably
continue to increase production and exports in 2011
and in the following years. Russia, Colombia and
New Zealand supply smaller quantities of coking coal.
Indonesia, Venezuela, Vietnam and South Africa supply
PCI coal.
Infrastructure for International Coal Trade
Owing to the rapid growth in recent years of the bulk
commodity trade as a whole, and of coal trade in
particular, infrastructure constraints have occurred.
There have been major bottlenecks, sometimes serious,
at both loading and discharge ports, on domestic railway
lines and in sea transport. The chance to exploit market
opportunities due to a rising demand for coal triggered
over the last 2-3 years a worldwide infrastructure
expansion, even though it came late, across all links
in the transport chain. Expansion projects along the
entire “coal chain” have been launched by almost all
of the major countries involved in international coal
trade. The problems have differed from one country to
another. In Australia, for example, the primary problem
is bottlenecks in port and railway capacities, while in
South Africa it is limited rail capacity, already resulting
today in the port of Richards Bay using only two-thirds
of its capacity.
The realisation of the many expansion measures would
have significantly improved the situation, above all in
Australia if there had been no floods at the beginning
of 2011.
Bottlenecks in supply are to be expected in 2011
because of the production shortfalls over several
months in Australia and against the background of a
rising demand for coking coal, which will affect prices
accordingly. If the USA covers additional demand as a
“swing supplier”, then shipping capacity could rapidly
reach its limit at US export ports.
In Indonesia, Colombia, Russia and South Africa,
many port expansion projects are in progress or already
completed.
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