Global thermal coal exports by major suppliers fall over 30% y-o-y, in Jan-Apr’22

During Jan-Apr’22 global thermal coal exports by six major countries including Australia, Indonesia, South Africa, Colombia, USA and Russia fell by 35% y-o-y to 144 mnt, CoalMint data shows.

During this period shipments to Asia declined by 35% y-o-y to 133 mnt while shipments to the EU (European Union) fell by 43%.

The sharp decline in shipments to Asian and EU markets was due to surge in prices that rose by 100% y-o-y coupled with logistical constraints in exporting countries such as Indonesia, Australia and South Africa. Moreover, geopolitical tensions resulting in sanctions on Russia by the EU, USA and a few other countries also impacted shipments.

South African and Australian coal exports to EU surge

*Qty in mn t

In percentage terms, South African and Australian coal shipments to the EU gained the highest followed by Indonesian coal exports. Russia, the top exporter of thermal coal to the EU, exported a much lesser quantity this year.

However, in terms of volumes, none of the country’s exports were able to compensate for the supply gap created by the absence of Russian coal. Shipments from Colombia also recorded a 39% decline due to key miners’ strike and weak output volumes.

Russian, Colombian exports to Asia record highest fall  

*Qty in mn t

In percentage terms, Asian thermal coal imports declined from all the origins in the first four months of the year, with the highest decline seen from Russia.

Among the key Asian buyers, Japan, South Korea and Taiwan imposed sanctions on Russia and therefore Russian shipments to these countries fell.

Also, no payment mechanism was in place after the onset of the Russia-Ukraine war resulting in a drop in exports to Asia.  However, currently Russian coal is finding its way to China as heavy discounts are being offered by Russian miners and the Rouble-Yuan payment system have made Chinese traders curtail coal imports from other sources. India is also eyeing imports from Russia now due to competitive rates, although no payment mechanism for INR-Rouble has been officially introduced yet.

In terms of volumes, the highest drop in shipments was recorded by Indonesia and South Africa. This was majorly due to logistical issues in both countries.

Short-term outlook

Amid elevated thermal coal prices on adverse weather conditions and logistical constraints, exports from the major countries are seen edging lower in the near term. Cheaper Russian coal is seen gaining more acceptance in China and India while Indonesian, Australian and South African coal may see increased presence in the EU market.