Development banks seek to revive world’s biggest power project
The planned Grand Inga hydropower complex in the DRC has been stalled for decades.
The price of importing coal to Europe’s largest ports rose the most since May as a strike in South Africa curtails shipments of the fuel during the middle of an energy crisis.
The action by Transnet SOC Ltd. employees is “lasting longer than anticipated and has started to take a serious toll on exports,” said Alex Claude, chief executive officer of DBX Commodities in London. Coal flows out of South Africa last week were 600,000 tons, the lowest in more than a year, he said.
South Africa’s troubles dovetail with those of European power producers, who are trying to stock up on coal ahead of winter to make up for dwindling supplies of natural gas from Russia. Traders are relying increasingly on South Africa because European Union sanctions ban purchases from Russia, long the continent’s largest source.
Month-ahead European coal futures rose as much as 11%. They’re now trading at about $290 per ton, rebounding from an almost seven-month low on Oct. 10. The jump also may be driven by traders covering shorts or profit-taking after a long decline, Claude said.
The Transnet strike also is hobbling iron ore exports as staff refuse to work unless the company raises their pay. Negotiations are set to continue Wednesday.
Coal exports to Europe from a consortium that owns the Richards Bay Coal Terminal in South Africa increased to 4.1 million tons in the first half of 2022, compared with 500,000 tons a year earlier, Thungela Resources Ltd. Chief Financial Officer Deon Smith said in August.
(By Todd Gillespie and Paul Burkhardt)
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