Coal Market & Transportation

Coal is a global industry, with coal mined commercially in over 50 countries and used in over 70. Coal is readily available from a wide variety of sources in a well-supplied worldwide market. Coal can be transported to demand centres quickly, safely and easily by ship and rail. A large number of suppliers are active in the international coal market, ensuring a competitive and efficient market.

Coal Transportation

The way that coal is transported to where it will be used depends on the distance to be covered. Coal transportation is generally carried out by conveyor or truck over short distances. Trains and barges are used for longer distances within domestic markets, or alternatively coal can be mixed with water to form a coal slurry and transported through a pipeline.
Ships are commonly used for international transportation, in sizes ranging from:

• Handysize - 40-45,000 DWT
• Panamax - about 60-80,000 DWT
• Capesize vessels - about 80,000 DWT

(For a glossary of useful terms used in the shipping industry, click here)

Coal Trade

Coal is traded all over the world, with coal shipped huge distances by sea to reach markets.
Over the last twenty years:

• seaborne trade in steam coal has increased on average by about 7% each year
• seaborne coking coal trade has increased by 1.6% a year.

Overall international trade in coal reached 1142Mt in 2011; while this is a significant amount of coal it still only accounts for about 16% of total coal consumed. Most coal is used in the country in which it is produced.
Transportation costs account for a large share of the total delivered price of coal, therefore international trade in steam coal is effectively divided into two regional markets

• the Atlantic market, made up of importing countries in Western Europe, notably the UK, Germany and Spain.
• the Pacific market, which consists of developing and OECD Asian importers, notably Japan, Korea and Chinese Taipei. The Pacific market currently accounts for about 57% of world seaborne steam coal trade.

Indonesia has overtaken Australia as world’s largest coal exporter. It exported over 300Mt of coal in 2011.
Australia remains the world's largest supplier of coking coal, accounting for roughly 50% of world exports.

Top Coal Exporters (2012e)

	Total of which	Steam	Coking
Indonesia	383Mt	380Mt	3Mt
Australia	301Mt	159Mt	142Mt
Russia	134Mt	116Mt	18Mt
USA	114Mt	51Mt	63Mt
Colombia	82Mt	82Mt	0Mt
South Africa	74Mt	74Mt	0Mt
Canada	35Mt	4Mt	31Mt

Top Coal Importers (2012e)

	Total of which	Steam	Coking
PR China	289Mt	218Mt	71Mt
Japan	184Mt	132Mt	52Mt
India	160Mt	123Mt	37Mt
South Korea	125Mt	94Mt	31Mt
Chinese Tapei	64Mt	56Mt	8Mt
Germany	45Mt	36Mt	9Mt
UK	45Mt	40Mt	5Mt

Sources: BP, IEA, World Steel Association, WEC
(e = estimated) (Mt = Million tonnes)