World Energy Outlook 2006

emains an exporter, but loses market share, as an increasing proportion of
the country’s output is diverted to domestic markets. This projection is
particularly uncertain: slightly faster demand or slower production growth
than projected here could turn China into a net importer. Four countries
– Australia, the United States, Canada and Russia – continue to account for
the bulk of coking-coal exports. Australia’s share continues to expand, from
63% in 2004 to 67% in 2030, extending its lead as the world’s biggest
exporter of coking coal.
Figure 5.4: Net Inter-Regional Trade in Hard Coal in the Reference Scenario
million tonnes
1 000
800
600
400
200
0
1980 1990 2000 2010 2020 2030
Steam coal
Coking coal
Coal Supply Costs and Investment
Supply costs are the primary determinant of where incremental coal
production and export capacities are added. Assessing those costs is difficult,
because they vary widely across countries and regions according to local factors,
including geology, technology, infrastructure and labour costs. The average
free-on-board cost of supply of steam coal, including production, processing,
inland transportation and loading onto ships (but excluding capital charges
and profit margins), ranges from less than $20 per tonne in Indonesia and
Venezuela to about $50 in the United States (Figure 5.5). Much of the coal
currently exported involves costs of around $25 to $30 per tonne. 3
3. These estimates are based on an analysis of coal-supply costs carried out by the IEA Clean Coal
Centre, submitted to the IEA in June 2006.
Chapter 5 - Coal Market Outlook 133
© OECD/IEA, 2007
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