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Why the coal price is down

Coal is combustible black or brownish-black sedimentary rock usually occuring in


rock strata in layers or veins called coal beds or coal seams. Coal is composed primarily of
carbon along with variable quantities of other elements, chiefly hydrogen, sulfur, oxygen, and
nitrogen. A fossil fuel, coal forms when dead plant matter is converted into peat, which in
turn is converted into lignite, then sub-bituminous coal, after that bituminous coal, and lastly
anthracite. This involves biological and geological processes that take place over a long
period.

Coal is the largest source of energy for the generation of electricity worldwide, as
well as one of the largest worldwide anthropogenic sources of carbon dioxide releases. China
is the biggest production of coal in the world. In 2011, China produced 3.520 million tonnes
of coal thats 49.5% of world coal production. The coal price in this year is USD 140.3/ton
and make the highest price of coal. Next year the price of coal down to USD 122.84/ton. Now
in 2016, the coal price is around USD 40/ton. Coal prices fall make some coal mine industry
closed the operation. The effect of this situation is many workers didn’t have a job.

There are 3 factor why the coal price fall. First, the supply of coal in the world is over.
In 2014, the supply in Indonesia is 250 million tonnes, but estimate the supply in China,
USA, and the bigger country in europe is down. Cause supply in China down is economic
growth has run-down too. Coal industry in China has down 6% only four month in early
2015. Second, people found a renewable energy that friendly to environment is called shale
gas. Shale gas has become an increasingly important source of natural gas in USA. Shale gas
make supply and sell of coal drop. Third, coal can cause environmental damage. Coal release
carbon dioxide emission that rise the air pollution.

Name : Dino Haryo Kusumo

NIM : 073001500031

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