China’s thermal coal imports jumped 9% year-on-year in 2Q16, according to the latest issue of the China Resources Quarterly (CRQ) from Australia’s Department of Industry, Innovation and Science. The country took 44 million t over the three months to June 2016 with the majority of that coming from Indonesia.
The southeast Asian country accounted for 51% of Chinese imports. In contrast, Australia saw its shipments to China fall 10% year-on-year to 9 million t, while the value of Australian exports fell 18% year-on-year to AUS$509.8 million.
Australian thermal coal exports to China peaked recently at 12.9 million t in 2Q14 but have now recorded four consecutive quarters under 10 million t – with a low of 6.6 million t in the first quarter of this year. The value of exports has fallen from AUS$870.7 million in 2Q14.
The increase in thermal coal exports comes as the Chinese government continues to cut back on excess domestic production. The government aims to eliminate 500 million t of production over the next three to five years.
“China’s thermal coal imports will remain moderately strong over the coming months due to a pronounced reduction in domestic production in the year-to-date and a temporary increase in demand from industries using coal as power generation,” BMI Research said in a recent research note.
Over the first half of the year, Chinese thermal coal imports registered a fall of just 3.4% year-on-year, a significant increase on the 34.8% decline seen in 1H15. That said, BMI Research believe the effects of government stimulus in driving coal demand, coupled with an easing of production cuts in 2017, will see thermal coal imports “subsiding gradually in the coming years.”
“Weak consumption growth means that China’s thermal coal imports will remain capped around the 108 million t registered in 2015,” BMI Research concluded. “China’s imports peaked at 192 million t in 2013 and we expect 2017 to see a resumption of the gradual contraction in imports.”
Edited by Jonathan Rowland.
Read the article online at: https://www.worldcoal.com/handling/17082016/chinese-coal-imports-jump-in-2q16-2016-2248/