China’s coal imports rose in March from a two-year low in February, but were still 40% lower than the corresponding period last year, as buyers continued to shy away from expensive imports and opt for price-capped domestic supplies.
The world’s biggest coal consumer, China brought in 16.42 million tonnes of coal last month, data from the General Administration of Customs showed on Wednesday.
That compares with 11.23 million tonnes in February, which was the lowest level since December 2019, and 27.33 million tonnes in March 2021.
Over the first quarter of 2022, China imported 51.81 million tonnes of coal, down 24.2% on the year. Indonesia, the top coal supplier to China, put a shock ban on coal exports for a month in January.
Industrial sources estimated China’s coal imports could fall by up to 30% this year as domestic output holds at a record level and strong demand for non-Russian supplies keeps import prices above those in the domestic market.
With import curbs on Australia and fears over secondary sanctions on purchases from Russia, Chinese traders have few choices in the market for seaborne coal, particularly as global coal benchmarks are nearly double domestic prices.
Beijing aims to keep domestic coal production at 12.6 million tonnes a day in 2022, cap prices for thermal coal and has urged utilities to sign long-term contracts with miners to ensure steady supply.
Chinese utilities typically start to replenish inventory in late April or May in preparation for peak electricity demand in summer. But a resurgence of Covid-19 across China that limited mobility and halted factory operations could dent coal demand.
Utilities’ daily coal consumption in eight coastal Chinese provinces reached 1.62 million tonnes by last week, down 9.6% from a week before and 12% lower than a year ago, data tracked by China Coal Transportation and Distribution showed.
- Reuters, with additional editing by George Russell
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