en.Wedoany.com Reported - South Korea's Western Power Company (KOWEPO) recently issued a tender, planning to procure 1.68 million tons of bituminous coal, with the delivery period spanning from June 2026 to June 2030. The required calorific value for this batch of coal is between 3,900 and 4,999 kcal/kg, placing it in the medium-to-high calorific value range, suitable for power generation purposes.

This tender is not for a short-term spot transaction but rather a four-year long-term supply agreement, indicating South Korea's continued reliance on coal within its energy mix. Despite global pressure to reduce coal usage, South Korean power companies are addressing energy security challenges by securing long-term supplies.

A similar trend has recently emerged across Northeast Asia. Due to impacts on liquefied natural gas (LNG) supplies from regional situations, countries like Japan and South Korea are increasing their coal procurement. South Korea has also adjusted its sulfur content standards to broaden its supply sources.

From a market perspective, this coal procurement contract, to be fulfilled over four years, has an annual average volume of approximately 420,000 tons. Although the scale of a single tender is limited, if more South Korean utility companies adopt similar strategies, the overall impact will become more significant.

This tender is expected to support prices for medium-calorific value coal, which primarily originates from countries like Indonesia and Australia. Currently, Indonesian supply is already showing signs of tightness, and the new demand from South Korea may further push up Free on Board (FOB) prices.

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