Coking Coal Price

The coking coal price has gone nowhere but up recently. The prices have shown to have been increasing since 2003. Of course there was always a little leeway. Prices would jump up and down, there would be peaks and valleys all over the chart, but they would usually maintain a consistent level. They would never stray too far away from a certain base value, but ever since 2003 the coking coal price chart has shown results that refuse to lower. Prices have been steadily increasing year after year. There was a small dip in 2006 but aside from that negligible fact, the evidence shows that coal is getting more and more expensive which could mean one of two things. Since most companies don’t jack up the price of their coal for no reason, we can assume that the reason coal prices have been skyrocketing across the globe is either because there is higher demand for it or because the source coal is running out. Because coal is seen as an almost outdated technology, it’s unlikely that an increase in demand would just randomly occur in 2003 and have that trend sustain in the coking coal prices index for years and years to come unless something that used a lot of coal was invented during that period. While it’s possible something may have been developed, it’s unlikely anything has gotten coal to be in such high demand as its cousin oil in such a short time. This scenario is also unlikely because we would have probably hears something about such a machine or device if it did exist, and it would have to have had enough of an impact on the market to cause a worldwide chain of events that would cause a divot in the charts, and that could take years.

What is more likely is that demand is increasing, but it is increasing only because of a shortage of source material. Our coal deposits are running thin and therefore we need to charge more for it, both to sustain the industry while they search for more coal as well as to make sure that the people that really need the coal are getting it. With higher prices, dad and grandpa are going to think twice about holding that barbecue at their house with only attendees. They’ll wait until they get the most use out of the available coal that there is. And this is the whole idea behind raising prices to that level anyway.

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