JAVIER BLAS: The coal industry is neither down or out

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Despite the final communique of the COP26 climate change summit, coal mining companies are making a killing

A bucket loads coking coal from the yard at a coke and gas plant near Moscow, Russia. File photo: BLOOMBERG/ANDREY RUDAKOV

The mining companies that have stuck with coal despite pressure to divest are making a killing. Look at Glencore, the world’s largest exporter of seaborne thermal coal. Its shares have risen to a 10-year high as investors anticipate a cash bonanza. For them, it’s an ideal world: Demand is rising, while supply is constrained because institutional investors, led by BlackRock , have convinced nearly every miner to stop opening new pits.

The consumption boom has wrong-footed many who said back in 2013-14 that coal demand had peaked and would soon start to decline. At best, coal consumption is settling at a high altitude plateau. At worst, it may continue rising. Beyond this year, the IEA forecasts some additional small demand increases for 2023 and 2024, setting fresh record highs in both years.

 

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