The latest industry data from the local mining sector showed coal miners dominating SA’s mineral production in August as global demand for fossil fuels held steady.
Stats SA figures released on Tuesday showed SA’s mineral production edged down 0.2% year on year, with platinum group metals (PGM), gold and manganese producers all weighing on output.
A standout performer, however, was coal, whose output jumped 4.1% year on year as major producers ramped up production to capitalise on an attractive demand outlook.
Exxaro Resources, owner and operator of some of SA’s largest coal mines, reported a jump in first-half sales and production in subsidiary Black Mountain Mining, boosting the country’s output.
In recent weeks, the coal behemoth has emphasised that coal remained central to its growth plans, with CEO Ben Magara telling journalists last week the company was exploring life-extension options to keep its coal mines operational beyond 2050.
Seriti Resource’s new Naudesbank Colliery, officially launched in March after reaching first production in February, promises to add about one-million tonnes to the country’s coal output each year.
Infrastructure supports export growth
Meanwhile, Transnet’s Freight Operating Company is helping to improve the performance of the country’s coal corridor, with Richards Bay Coal Terminal forecasting coal export volumes of 57-million tonnes this year — two-million more than it expected in January.
Even as the mining sector works to reduce its carbon footprint, coal remains central to SA’s energy mix, catering to more than 70% of domestic energy demand.
Export demand also remains strong, with Reuters reporting earlier this week that Chinese coal imports rose to a nine-month high in September as rising domestic prices made imported coal more competitive.
Global coal demand surges
The International Energy Agency (IEA) predicts global coal production will soar to a record 9.2-billion tonnes in 2025, with miners set to increase global supply in response to a strong demand forecast.
The continued elevated demand for coal offers a reality check in terms of the world’s progress towards a clean energy transition — a shift in which SA, which is among the world’s top 15 largest greenhouse gas emitters, plays a critical role.
Last year, global demand for coal rose 1.5% year on year to a new record of 8.79-billion tonnes, even as many countries enacted more stringent environmental policies and poured funding into renewable energy infrastructure.
Stats SA’s latest production data showed that despite an overall slip in mineral production, local mineral sales at current prices surged 23% in August, fuelled by soaring precious metal prices.
Sales of gold, the price of which is up more than 55% in the past year, skyrocketed nearly six-fold on an annual basis, while PGM sales jumped 44% year on year.
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