Global Coal Prices Surge Fourfold in the Past Year

Global coal prices have surged amid concerns over the consequences of Russia's invasion of Ukraine.

According to Investing.com data, the Newcastle coal benchmark (NCFMc1) price for March 2022 contracts reached US$400 per ton on Wednesday (March 2nd), its highest level ever.

However, on Thursday (March 4th), coal prices reversed course, falling 7.8% to close at US$370 per ton.

Compared to December 31, 2021, current coal prices have more than doubled, increasing by 118.16% year-to-date (YTD).

Similarly, compared to March 3, 2021, the price of this commodity has increased more than fourfold, or 320.69% year-on-year (YOY).

Meanwhile, the Newcastle coal price for April 2022 contracts stands at US$358.45 per ton, and for June 2022 contracts at US$335.95 per ton.

Concerns about soaring coal prices are linked to the fact that Russia is one of the world's largest coal exporters, particularly to the European Union. The EU is heavily reliant on Russia not only for coal but also for other energy products.

If Western countries impose sanctions on Russia, coal supplies for power plants in Europe are expected to be disrupted, triggering further price increases in the international market.