Newcastle coal futures slumped to under $114 per tonne in January, the lowest in over three-and-a-half years, as soaring output offset robust demand from the world’s top fossil fuel consumers. The Chinese Coal Transportation and Distribution Association announced that output is set to expand 1.5% to 4.82 billion tons in 2025 following a record-setting 2024. The agency cited expanded mining capacity to avoid risks of lower availability stemming from carbon emission limits and mine shutdowns from safety protocol breaches. The development occurred as utilities already deal with record-high coal inventories, which rose by 12% in the two months ending October. In the meantime, concerns that stimulus from Beijing will not be able to trigger growth weighed on the record-high thermal consumption in 2024. Additionally, demand was further pressured by ample rainfall in key Chinese manufacturing hubs, allowing hydroelectric power to be preferred over coal power.
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