Coal news and updates

China's coal imports from Australia hit 15-mth high as trade hurdles removed

SINGAPORE, April 21 (Reuters) - China's coal imports from Australia rose to the highest level since Dec. 2021 in March after Beijing removed barriers on coal trade with the country and Chinese traders rushed to make profits off falling overseas prices.

China brought in 2.22 million tonnes of Australian coal last month, data from the General Administration of Customs showed on Friday, comprising 1.93 million tonnes of thermal coal and 284,990 tonnes of coking coal.

That compared with 207,236 tonnes in February but was significantly lower than the monthly average of 7 million tonnes before China introduced the unofficial ban in late 2020.

Chinese utilities and traders have stepped up purchases since late February with Australian coal costing less than local supply. China's consumption is expected to pick up following the reopening of its economy from strict zero-COVID measures.

Some 5 million tonnes of Australian coal are expected to reach China in April, shiptracking data from Refinitiv and Kpler showed.

But as China's domestic coal prices have weakened due to growing output and high inventories, the price advantage of Australian coal in China is diminishing.

Australian coal with energy content of 5,500 kilocalories (kcal) is priced at about 1,096 yuan ($159) a tonne in southern China and the domestic coal of similar quality is about 1,140 yuan a tonne, according to trading sources.

Customs data on Friday also showed coal imports from Russia reached 8.84 million tonnes last month, higher than the average of 7.4 million tonnes in the first two months of this year.

Beijing has extended zero tariffs on coal imports from all countries until the end of 2023, which would help supplies from countries such as Russia and Mongolia to compete in China.

Arrivals of Indonesian coal in March more than doubled from a low-base a year earlier to 21.98 million tonnes, customs data showed, as traders stepped up purchases ahead of the Muslim fasting month when coal production and transport typically slow.

China's coal import growth could lose momentum amid a rapid increase in domestic output.

Khoo Pat See, Senior Analyst, Global Power and Renewables at S&P Global Commodity Insights, estimated 300 million tonnes of coal mining capacity was added in China in 2022 and 250 million tonnes more is expected to be added in 2023.

($1 = 6.8725 Chinese yuan renminbi)

(Reporting by Muyu Xu; Editing by Sonali Paul)

((muyu.xu@thomsonreuters.com; +65 9829 1075))

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