Page 13 - AsiaElec Week 34 2022

AsiaElec COAL AsiaElec

Chinese imports of Russian

coal hit five-year high

SOUTH KOREA JULY saw imports of Russian coal by China hit Projections from some in China now point
a five year high, well up from the 6.12mn tonnes towards Russian imports through the end of
imported during June, and reaching over 7.4mn the third quarter increasing further as Chinese
tonnes by the end of the month. utilities, particularly in the north of the country,
And with the ongoing heatwave continuing look to stockpile coal ahead of increased demand
to draw heavily on regional utilities across many for electricity during the often sub-zero winter
nations in East Asia, China’s reliance on dis- months.
counted Russian coal shows no signs of abating Despite the increase in numbers relating to
any time soon. Russian coal imports, overall China has started
Western nations have effectively now been to reduce its dependency on imports of coal
banned from importing Russian coal since in recent months as the central government in
August 11 on the back of legislation aimed at Beijing continues to exert pressure on domestic
punishing Moscow for its invasion of Ukraine. mines to increase output.
A long time coming, Russia responded to the Even imports of Indonesian coal throughout
anticipated ban earlier in the summer by offer- July, whilst bucking the overall downward trend
ing coal at large discounts. This was particularly in the short term at least, have fallen drastically
well received by large-scale Asian buyers, most year on year.
notably China and India, with India even now Indonesian coal imported by China is in the
continuing to face pressure from the West to join main made up of lower quality and thus cheaper
sanctions against Moscow and end Russian coal thermal coal than that found in neighbouring
and oil imports. Australia. Correspondingly, Indonesian coal
As a result, this has seen both Beijing and runs at a heating value of below 3,800 kilocal-
New Delhi offered Russian thermal coal for ories (kcal) compared to just over 5,000 kcal for
prices as low as $150 per tonne using a cost and both Australian and Russian thermal coal.
freight basis compared to similar quality Aus- Total July exports, released by the Trade Min-
tralian coal still costing $210 per tonne, albeit istry in Jakarta, headed to China amounted to
using a free on board (FOB) basis. 11.7mn tonnes; a figure up 22% on the month
Subsequently, the most recent data released prior, but down by around 40% on the same
by China’s General Administration of Customs month in 2021.
(GAC) late last week indicated that the 7.42mn Prices for Indonesian coal in recent weeks
tonnes brought during July was the largest have been floating around the $78 per tonne
amount imported since record keeping began level using an FOB basis, a figure considerably
in 2017. lower than costs per tonne for even domestically
The previous high is understood to have been mined Chinese coal at around $101 per tonne,
just under 1mn tonnes lower at 6.49mn tonnes, including shipping.
in July 2021. Reports from China now say this price differ-
During the same July 2022 time-frame, the ence has seen a growing number of power plants
Chinese authority’s data listed no imports as hav- across the south of the country start to increase
ing arrived from Australia. With long-standing tenders for Indonesian coal imports through
political stand-offs between Beijing and Can- August to help offset ongoing record power
berra now starting to thaw, though, this could demands as temperatures across much of East
change as Chinese utilities looks towards the Asia continue to break records.™
winter.

Week 34 24•August•2022 www. NEWSBASE .com P13