Australia’s thermal coal exports recorded a fall of 9% m-o-m at 14.3 milion tonnes (mn t) in May’21 against 15.7 mn t in Apr’21, CoalMint’s vessel line-up data revealed.
Despite recording a dramatic surge in exports to India and Vietnam in May’21, the country’s thermal coal exports to its two top destinations of Japan and Taiwan fell by 20% and 37% respectively. The exports to South Korea observed a marginal rise of 0.6% during the month.
Countries update
In case of Japan, constraints on coal-fired capacity and recovering nuclear availability are capping its thermal coal demand since Apr’21. The resurgence in Covid in Japan last month also impacted the country’s power consumption in May’21, impacting its thermal coal demand.
In addition to this, market sources informed CoalMint that, Japanese power utilities have already stocked up on sufficient coal for the upcoming peak summer months (Jul-Aug), resulting in reduced imports in May.
Taiwan’s thermal coal imports in Apr’21 saw a jump of 58% m-o-m to 2.77 mn t which was much higher than the monthly average of 1.87 mn t in Apr 20 to Mar 21. Subsequently, the importers booked lesser volumes of coal during May, resulting in a m-o-m drop of 36%.
Indian buyers preferred Australian thermal coal in May as the same was cheaper against that offered by South Africa and Indonesia, making India’s Australian thermal coal imports go up by 41% m-o-m during the month. Despite resurgence in Covid cases in the country and subsequent lockdown in May, buyers stocked up on cheaper Australian coal ahead of the monsoon season.
Vietnam, which has become a key importer of Australian thermal coal since the latter’s prices corrected last year, saw increased imports due to the containment of Covid cases and revival of industrial activities. Global demand for industrial and consumer goods is recovering, in the process, boosting Vietnam’s exports, which are, in turn, leading to increased power consumption especially from the manufacturing units.
Outlook
• Imports from Taiwan are expected to go up in Jun’21 given the fact that country faced two severe power outages in the second half of May, compelling the country to increase its thermal coal purchases from Australia amid the ongoing summer season.
• The summer heat,Tokyo Olympics and Paralympic Games in Japan are factors that will push the country’s demand for electricity this summer. This, in turn, will boost the country’s thermal coal requirements in the coming months.
• Imports from India and Vietnam are also expected to remain elevated amidst the industrial activities that may resume in both the countries, post relaxation of Covid restrictions.
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