Market Snapshot: Canadian coal production hits 30 year low

Release date: 2017-03-29

Canadian coal production generally declined or was flat, since a 1997 peak of 78.8 million tonnes (MT).Footnote 1 Estimated production in 2016 was 60.4 MT – the lowest since 1987. The majority of Canadian coal production is in western Canada, namely B.C., Alberta, and Saskatchewan.Footnote 2

Source and Description

Source: CANSIM 135-0002 and 303-0016, NEB Energy Futures 2016 Update

Description: This line graph plots total Canadian coal production from 1976 to 2016. Coal production generally grew between 1976 and 1997, from 25.3 MT to 78.8 MT. Coal production generally declined or was flat since then, falling to an estimated 30-year low of 60.4 MT in 2016.

Coal produced in Canada is divided in two categories: thermal and metallurgical. Thermal coal is used in electric power generation and metallurgical coal is primarily used to produce steel. Currently, about half the coal produced in Canada is thermal and most of it is used by domestic power producers; the remainder is exported. The majority of Canadian metallurgical coal is exported to Asia; the remainder is used by domestic iron and steel-makers.

Between 2013 and 2016, Canadian coal production fell by 12%, with further declines expected. Current NEB projections estimate total Canadian coal production in 2040 at 34 MT – close to 1979 production levels. The projected decline is attributed to coal-powered plant phase-out in Alberta. Nearly all the coal produced in Canada by 2040 will be metallurgical (32 of the 34 MT).

 

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