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Newsroom articles are published by leading news agencies. Hargreaves Lansdown is not responsible for an article's content and its accuracy. We may not share the views of the author.
Unintended but not unexpected is one way of describing what's happening to the price of steel-making coal as governments suppress supply in the face of steady demand growth, a perfect recipe for a higher price.
Article originally published by Forbes. Hargreaves Lansdown is not responsible for its content or accuracy and may not share the author's views. News and research are not personal recommendations to deal. All investments can fall in value so you could get back less than you invest.
21 Nov 2023
On cue, high-quality hard coking (or metallurgical) coal has risen by 9% over the past three months to around $264 a tonne, and is forecast by Goldman Sachs to rise by another 6% to $280/t before the end of the year.
Multiple factors influence the price of coking coal and its lower-grade cousin, thermal or steaming coal used in the production of electricity, with both blamed by environmentalists and governments for causing carbon pollution and climate change.
But lumping all forms of coal into the same basket and limiting supply growth by withholding mine development approvals, which is what’s been happening in Australia and Canada, is having the predictable effect of driving up the price of coking coal even as thermal coal falls.
The gap, and the promise of long-term demand growth for coking coal, has sparked a burst of corporate activityRead more on hl.co.uk