Global energy crisis speeds up decline of Australia’s coal export
The record high prices of coal and gas will drive the market towards cheaper energy sources.
The global energy crisis that has driven prices of coal and gas up will likely lead to the “faster-than-expected” decline of thermal coal exports in Australia.
This comes as the record-high prices of coal and gas advance Australia’s switch to cheaper energy sources, such as solar and wind.
“Australia’s traditional key export markets—Japan, South Korea, and Taiwan—are all shifting away from reliance on expensive imported thermal coal in the long term,” Simon Nicholas, Energy Finance Analyst, Institute for Energy Economics and Financial Analysis (IEEFA), said.
“The Federal Government’s Office of the Chief Economist forecasts coal imports into Japan, South Korea, and Taiwan to all go into permanent decline this decade.
Nicholas added the markets that are supposed to import from Australia, such as Vietnam, Pakistan, Bangladesh, and the Philippines, have also significantly reduced their imports.
“Very high coal prices are a double-edged sword for the coal industry. At this stage of the energy transition, high prices will destroy long-term demand for coal even faster,” Andrew Gorringe, Coal Sector Energy Finance Analyst, said.
“Declining demand will impact mining employment. Even under the NSW government’s Base Case scenario, it projected that employment in coal mining will decline by an average of 600 jobs per year over the next two decades.