International coal prices dropped in 2020 due to COVID-related demand depression. However, things have changed significantly with international prices rising to all time highs in 2021. Especially in South Africa, high quality coal will be even harder to source in the coming years. Key drivers for the movement in the international and the South African coal prices are:
An increasing demand for coal in the Southern African inland market, which is required to meet the new wave of industrialization in Africa
India has become Southern Africa’s biggest coal customer, focusing on lower-grade RB3 coal
Legislative restrictions in China affecting global coal demand.
Supply risk due to lack of exploration and fragmentation of producers in South Africa
A series of new coal-based projects are being planned in several African countries to meet the increasing energy demand.
Maatla Resources' Mmamabula Coal Mine will produce high-grade coal for the export and regional coal market. The company has received expression of interest to produce an RB3 product of Peas, Nuts and Duff.
Mmamabula Coal Mine is well suited to produce sized coal for the regional coal market. The mining project is in close proximity to existing railway infrastructure and will produce sized coal for:
Cement and lime producers in South Africa
Ferro Alloys Industry
Hospitals and General Boiler Applications
The mine has a distinct distance advantage over South African coal mines to the cement and lime industry in the Northern Cape.