The exit of the world’s second largest coal company: a symbol of the end of coal
On January 28, 2023, Glencore, the world’s second-largest coal producer, announced plans to exit the industry within two years. The move, which is seen as one of the company’s biggest strategic changes in recent years, reflects a declining trend in the global coal industry.
Glencore, which is a Swiss multinational company, currently produces about 150 million tons of coal annually. The company owns coal mines and assets around the world, including in Australia, South Africa, the United States, and Canada.
Glencore CEO Gary Nagel said in a statement that the company had decided to exit the coal industry because the industry “no longer has a viable future”. Nagel added that Glencore plans to focus on growing segments of the energy market, such as transition metals and renewables.
Glencore’s withdrawal from the coal industry is a big blow for this industry. The company was one of the largest producers of coal in the world, and its exit indicates a decrease in demand for this fossil fuel.
Various factors have reduced the demand for coal. One of the most important factors is increasing environmental concerns about pollution from burning coal. Many governments around the world have enacted laws and regulations to reduce greenhouse gas emissions, which has increased the cost of generating electricity from coal.
Another factor in reducing the demand for coal is the increase in competition from renewable energy sources. The price of renewable energy, especially solar and wind energy, has decreased significantly in recent years. This has made the production of electricity from these sources more affordable for many countries than the production of electricity from coal.
Glencore’s exit from the coal industry is an important sign of the industry’s declining trend. This action shows that the coal industry is entering a new and challenging period.
Consequences of Glencore’s exit from the coal industry
Glencore’s exit from the coal industry will have various consequences. This action can lead to a decrease in the price of coal in the world market. This can benefit smaller coal producers who can compete at lower prices.
Glencore’s exit could also lead to job losses in the coal industry. This company currently employs about 40,000 people worldwide. Glencore’s exit could lead to job losses for many of these people.
On the other hand, Glencore’s withdrawal from the coal industry can help reduce air pollution and greenhouse gases. This company produces about 100 million tons of greenhouse gases annually. The withdrawal of Glencore can lead to a reduction of this amount of greenhouse gas emissions.
Overall, Glencore’s exit from the coal industry is an important and significant event. This action shows the declining trend of the coal industry in the world.