The coal mining sector in Poland is going through problems similar to those abroad, Deloitte said in a report. The consulting firm said that the main problems that the mining sector faces in all countries is growing costs and uncertainty about demand for coal.
Polish mining companies currently hold about 9 million metric tons of unsold coal in their storage areas. Apart from that, energy suppliers have about 5 million tons of coal reserves. Deloitte said that it may be difficult to sell these reserves.
The consultancy also said that Polish mines are becoming less competitive as their production costs grow. The companies have reached a point where costs are a serious threat to profitability, Deloitte said.
The authors of the report point to the economic slowdown currently experienced by China, which is the world's biggest consumer of coal. The discrepancies between the projections and the real value of global coal demand have a detrimental effect on the prices of raw materials and, consequently, on investment decisions. Many investment projects in coal mining have been suspended due to market uncertainty.
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