Coal is a hot commodity in China

After a brief hiatus in the demand for coal, the price of coal has surged.

The rising demand for coal could be linked to the use of steelmaking coal for expansion occurring in metropolitan cities—often in countries experiencing rapid economic growth.

“The rising demand for steel to build infrastructure—particularly in emerging economies like China and India—(is) a major driver of the demand for steel and steelmaking coal needed to make it," said Nic Milligan, manager of community and aboriginal affairs at Teck.

More than 60 per cent of Teck’s steelmaking coal is shipped to customers in Asia. Milligan said the World Steel Association named China accountable for almost half of the steel production worldwide in 2011. Often, steel is utilized for building hospitals, bridges and railways, and Teck has been monitoring the demand carefully.

“The growth in demand for steel in emerging economies like China is one of the major drivers,” said Milligan. “China is expecting to see its urban population grow by approximately 350 million people over the next 15 years, which means building infrastructure to support almost two million new city dwellers every month. On top of that, the middle class in China and India is growing—driving new demand for consumer goods like cars and appliances, all (requiring) steel and steelmaking coal.”