Maritime coal transportation to advanced economies during the first ten months of 2024 dropped by 6% compared to the same period last year, according to a recent BIMCO report. The year could end at this pace with the lowest coal shipment volumes in the past 15 years, reflecting a structural shift in global fossil fuel trade.
Sharp Decline in Europe, Moderate Drop in Asia
The decline has been particularly steep in Europe, where coal imports between January and October fell by 22% compared to the same period in 2023. BIMCO attributes this drop to advancements in decarbonizing power generation. Meanwhile, advanced Asian economies saw a more moderate decrease of 4%, driven by increased electricity demand for air conditioning amid soaring temperatures.
Thermal Coal vs. Coking Coal
The seaborne trade of thermal coal, primarily used for electricity generation, decreased by 9%. However, imports of coking coal, roduction rose by 1% despite a slight decline in steel output. Historically, advanced economies accounted for 57% of global seaborne coal trade in 2009, but this used in steel p has now dropped to just 30%.
This shift globally contributed to a 0.5% decline in maritime solid bulk transport during 2024.
Export Trends by Country
Coal exports from key producing countries also declined in 2024. Russian exports fell by 18% yearly due to logistical challenges, while South African shipments dropped by 34% due to operational constraints. The United States reduced coal exports by 10%, redirecting volumes toward emerging economies amid declining European demand.
Outlook: Declining Coal Imports and a Structural Shift
Coal imports by advanced economies are expected to continue declining, driven by investments in renewable energy and the transition to recycled steel production, which does not require coking coal. Demand may also weaken in emerging economies as renewable electricity generation expands and domestic mining increases. Projections indicate maritime coal transport could decrease by 1% to 2% in 2025.
A Changing Market Landscape
BIMCO highlights that the coal market’s trajectory reflects a structural shift driven by decarbonization efforts. This trend presents challenges and opportunities for the maritime sector, which must adapt to an evolving energy landscape.