solid fuel Market

The solid fuel market is expected to grow from US$ 389.14 billion in 2022 to US$ 401.54  billion in 2028; it is expected to record a CAGR of 0.5% during 2022–2028.

There is an expansion and development of refineries across the world. In June 2022, the IEA oil market report predicted that net global refining capacity would expand by an extra 1.6 million b/d in 2023. The expansion or new refining capacity growth consists of various high-capacity refinery projects underway, especially in the Middle East and China. The aforesaid region and country have the potential to add over 4.0 million b/d of new capacity in next two years.

• In China, it is projected that overall capacity would have a snowball effect owing to commence of minimum two new refinery projects and one major refinery expansion.
• Substantial refinery capacity was extended in the Middle East in 2021. In Saudi Arabia, Jizan refinery with 400,000 b/d capacity came online by the end of 2021 and commenced exporting petroleum products at the beginning of 2022.
• New refining construction with more than 2 million b/d capacity is estimated to come online to assist markets in Indian Ocean basin. Along with this, another major project is scheduled in Atlantic basin. After completion of the mentioned project, a 650,000 b/d Dangote Industries refinery in Lagos (Nigeria) will be the largest in the country. The development of a refinery would meet domestic and neighbouring African countries’ demand for petroleum.

Therefore, the expansion of refineries would increase the use of solid fuels, which is expected to offer lucrative opportunities for the solid fuels market during the forecast period.

Impact of COVID-19 Pandemic on Solid Fuel Market Growth

The enactment of lockdowns and travel restrictions, the shutdown of production facilities, and the disruption in the supply chain adversely affected major players' performances in the solid fuel market. In the wake of COVID-19 pandemic, the burden on coal miners increased. In the US, three companies declared suspension of their operations within the territory to control the novel coronavirus spread. Coronado Global Resources of Australia suspended their US thermal and metallurgical coal mines owing to the global economic downturn caused by the pandemic in 2020. Moreover, Alliance Resource Partners (ARLP) temporarily closed the coal production at its Illinois basin mines to limit the virus spread. Such a halt in production activities negatively impacted the market. Also, the country's coal production took a nosedive in 2020 since the pandemic caused a sharp rise in electricity demand. On the contrary, the demand for coal has started gaining momentum since the demand for coal is rising from cement makers and power generation plants.

In terms of revenue, North America dominated the solid fuel market share. The production of coal is rising in North America. According to U.S. Energy Information Administration in January 2023, the coal production in the US was 139.97 MMt [154.3 million short tons (MMst)] in the third quarter of 2022, with an increase of 5.9% compared to its second quarter and growth of around 4.0% compared to the third quarter of 2021. In addition, anthracite accounted for 1% of total coal mined in the US in 2021. Further, the total coal consumption in the US was 131.63 MMt (145.1 MMst) in the third quarter of 2022, with an increase of 23.1% compared to its second quarter. Thus, the rising coal production and consumption increase anthracite production, which boosts the solid fuel market growth in North America.

Coal is one of the largest sources of CO2 emission. According to a report by International Energy Agency (IEA) in November 2022, IEA’s Net Zero Emissions by 2050 aims to reduce the use of coal and look for newer technologies. Moreover, the region is adopting hydropower electricity generation as it is one of the clean sources of energy and is extensively used for power system flexibility and resilience. According to US Department of Energy report in January 2021, the hydropower capacity increased by a net of 431 MW in 2019 since 2017. The capacity increased from existing facilities, new facilities, and by powering non-powered dams (NPDs), which resulted in total net growth of 1,688 MW from 2010 to 2019. Thus, the adoption of hydropower across North America will restrain the solid fuel market growth in the coming years.

Coal plays an integral part in electricity generation and iron and steel production. Steel is a crucial material in consumer and industrial products, including vehicles, appliances, and other. The US is one of the largest steel producers in the world. According to the US Census Bureau data, the profits from steel production increased to US$ 29.6 billion in 2021 from US$ 2.7 billion in 2020. Rising population propels the demand for steel products, which, in turn, increases steel production. The rise in steel production will boost the demand for coal in North America during the forecast period.

Indian Oil Corp Ltd, Exxon Mobil Corp, RESORBENT Sro, JH CARBON PTY LTD, Essar Global Fund Ltd, BP Plc, Lukoil Oil Co, Valero Energy Corp, Phillips 66, and Hargreaves (UK) Services Ltd. are a few key solid fuel market players.

The overall solid fuel market size has been derived using both primary and secondary sources. To begin the research process, exhaustive secondary research has been conducted using internal and external sources to obtain qualitative and quantitative information related to the market. The process also serves the purpose of obtaining an overview and forecast of the solid fuel market size with respect to all market segments. Also, industry participants and commentators have conducted multiple primary interviews to validate the data and gain more analytical insights. Participants of this process include VPs, business development managers, market intelligence managers, and national sales managers, along with external consultants such as valuation experts, research analysts, and key opinion leaders, specializing in the solid fuel market.