India will drive growth in the global seaborne metallurgical (met) coal during 2015, importing a further 2 million tonnes (Mt), according to a forecast by energy research company Wood Mackenzie.
The company bases its argument on the expected retreat of around 4-5 Mt in Chinese imports, due to its slowing steel sector, lower coke prices and continued uncertainty regarding trace element standards being enforced on met coal.
On the other hand, India is set to boost its seaborne imports amid its steel production growth which is on course to increase by 4% this year. Semi-soft coking coal and pulverised coal injection coal are expected to see imports rise sharply thanks to the ongoing focus on hot metal cost reduction.
Wood Mackenzie predicts a 123 Mt rise in in global trade in the period to 2035, with India expected to account for 40% of this figure and China contributing 28%.
“Indian demand will reaching parity with China by 2035. However, while there is potential for huge steel consumption growth within India, the ability to satisfy that demand is constrained by bureaucratic procedures, regulations and permitting issues,” the research company claims.
As a result, a relatively modest steel growth of 4-5% per annum from now until 2020 can be expected, before ramping up to 6-7% per annum in the period to 2035.
The dry bulk sector is heading for a slowdown in 2015 to a rate of 4-5%, according to a forecast by BIMCO.