OPINION: Asia's hunger for coal keeps growing

August 18, 2015

This opinion piece originally featured in the Newcastle Herald on August 18 2015

A myth repeated often enough can sometimes become regarded as fact despite evidence to the contrary.  

Take for example the myth that demand for NSW coal has fallen and that global coal use is drying up.

Aerial-of-Port-2010-05-12(from-Port-of-Newcastle)-(1).jpg

 
Pictured: an aerial view of the Port of Newcastle
 
This myth is mostly propagated by anti-coal activists. However it has unfortunately also been adopted recently by some mainstream commentators.  This is unfortunate because it is not supported by the facts and talks down an industry that will remain vital to the NSW economy for decades to come. 
 
While the NSW coal industry has been hit hard by low commodity prices, demand for NSW coal continues to rise, and emerging markets are creating new opportunities.
 
Last week, Port Waratah Coal Services announced it had broken the existing record for coal loaded for export in a single day - 495,000 tonnes.  This astonishing daily movement of coal reflects the strong and growing demand for NSW coal, which continues to be by far this State’s most valuable export. 
 
While results for the the full 2014-15 financial year are yet to be released, data from the nine months to March 31st shows that coal exports rose by nearly 5% over the corresponding period in the previous year, from 127 million tonnes in 2013-14 to 133 million tonnes in 2014-15.

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Exports of NSW coal to Korea were up 8%, while exports to Taiwan rose by 21% and across the rest of Asia (outside of Japan and China), exports more than doubled. 
 
Much of the misinformation surrounding demand for NSW coal is fueled by a slight fall in the rate of growth in demand from China.  This is despite the fact that just seven years ago, China accounted for only 1.1% of NSW coal exports.  Today, China comprises 18% of our total coal exports.  
 
And many don’t seem to realise, or choose to ignore that while China is an important market for NSW second coal, our largest market, Japan, imports more than double the volume of NSW coal imported by China. 
 
Japan continues to be the biggest market for NSW coal comprising 40% of total exports, followed by China at 18%, Korea with 17% and Taiwan at 11%. 
 
The increase in coal export volumes through the Port of Newcastle bodes well for the long-term future of the Hunter economy.
 
In the Hunter, 11,000 workers and their families rely on coal mining for their livelihood.  That’s in addition to the 4,238 local businesses and their employees that engaged with the local mining sector in the last financial year.  And the economic activity generated by mining underpins the strength of communities right up and down the Valley.
 
Improved technology and low emissions innovation here and around the world will ensure that the Hunter will continue to be a regional energy hub for decades to come. And coal will continue to play a prominent role, along with all other energy sources that will be needed to power an energy-hungry planet.
 
 

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