European coal might be having some of the same problems as US natural gas: supplies are building up, and places to store it are being stretched.
Natural gas kept in storage in the US has been closely watched in recent months: abundant supply and anaemic demand saw inventories reach record level, prompting fears that the limits of capacity would be reached. News last month that there was still a few hundred million cubic feet of capacity going gave prices a boost.
Now one of Europe’s biggest coal import terminals has broken records for coal storage levels.
Argus reports that levels at Rotterdam’s EMO terminal, have risen relatively quickly:
Stocks are at 4.2mn t, up by about 800,000t from a month earlier. There was a record 3.959mn t of coal in stock in early October. Stocks peaked at 2.752mn t last year.
There is still some room left, however:
The expectation is that stocks will continue to increase in the short term. EMO’s maximum storage capacity is around 4.5mn t, but this can vary.
It’s partly because of transport logistics, rather than supply and demand. But like energy demand, coal transport is affected by the weather. One of the reasons for the coal build is that low rainfall has meant river water levels are too low for barges to take their normal load of coal off to other destinations, such as manufacturing-intense Germany. Other European ports, Argus notes, have also reported rapid stock builds in the past few weeks.
European coal storage capacity fills up (Argus, 06/11/09)