Việt Nam poised to become world's fifth-largest coal importer by 2024: IEA
Việt Nam is expected to become the fifth-largest coal importer globally by 2024, driven strong electricity demand and a shortage of hydropower.
Global coal production and consumption remain robust, with no sign of slowing down, according to the International Energy Agency’s (IEA) mid-year Coal Report, released in July 2024.
Global coal trade reached an all-time high in 2023. Major coal producers – China, India and Indonesia – saw substantial increases in output, with China up by 3.4 per cent, India by 12 per cent and Indonesia by 13 per cent. Total global coal production hit a record 8.9 billion tonnes.
On the other hand, over the past decade, mainland China, India, Japan, South Korea and Taiwan have remained the top five global coal importers, highlighting Asia's dominance in the coal trade. Recent economic growth in China and India has spurred increased coal imports, while Japan, South Korea and Taiwan have seen stable levels.
Việt Nam is expected to become the fifth-largest coal importer globally by 2024, following significant growth in coal imports in 2023. IEA attributes this rise to strong electricity demand and a shortage of hydropower.
In 2023, Việt Nam imported 51.16 million tonnes of coal, spending US$7.1 billion. Import volume increased by 61.4 per cent and import value by 0.7 per cent compared to 2022.
Việt Nam’s coal consumption continued to surge in the first half of 2024, driven by strong electricity demand and lower hydropower output. To the end of June, the country imported 33.43 million tonnes of coal, a 38.6 per cent increase from the previous year, spending $4.15 billion, a 14.5 per cent increase year-on-year.
Despite increasing imports from Laos, Việt Nam's recent cancellation of the Sông Hậu 2 coal-fired power plant and other mothballed projects are leading the IEA to reassess its coal consumption outlook.
Main source of power production
Coal remains the largest global source of electricity generation.
In 2023, coal-based power generation increased by 1.9 per cent to a record 10,690 TWh. Despite this, IEA forecasts a potential slowdown in global coal-fired electricity growth in 2024, due to a rebound in hydropower in China and significant expansions in wind and solar energy.
In the first half of 2024, global coal production experienced a slight decline of 0.7 per cent year-on-year, largely due to a 1.7 per cent drop in China. This reduction is attributed to enhanced safety inspections in Shanxi province, China’s largest coal-producing area and a slowdown in domestic demand.
India, on the other hand, continues to boost production to avoid shortages and reduce imports, while Indonesia aims to produce 720 million tonnes in 2024 but has approved extraction of over 900 million tonnes.
In the United States, the fourth-largest coal producer, output fell by an estimated 17 per cent in the first half of 2024, driven by high stockpiles at power plants. European coal production is also expected to decline.
Global coal demand is expected to remain steady at around 8.7 billion tonnes in 2025. The IEA notes that the power sector accounts for two-thirds of global coal demand, with significant variations in consumption driven by electricity generation. — VNS
