Chinese end buyers had been keen to import seaborne coal since mid-August to the end of September. Tenders issued by major power utilities indicated China’s coal imports may extent the upward trend in September and October.
Chinese buyers kept high buying interest in seaborne imported coal, as domestic supply was expected to shrink before the 20th national party congress amid strict safety inspections. Southern power plants maintained active purchases of seaborne coal in September, which drove Indonesian low-CV coal prices to a multi-month high.
It was understood that prompt cargoes were sold out as early as mid-September in the market, especially for Panamax 3,800 Kcal/kg NAR coal.
Also, market sources noted departure of many vessels was postponed since mid-September, when vessels waiting for loading at ports in South Kalimantan were lining up to the end of September. Therefore, many cargoes supposed to arrive at the end of September are expected to arrive in mid-October.
This was consistent with Kpler’s cargo-tracking data, which showed Indonesia’s coal exports hit 42.9 million tonnes in August, the highest since at least January 2021, up 26.12% year on year and 1% month on month. The figure rose to 44.73 million tonnes in September, up 36.87% year on year and 5.84% month on month.
Exports to China, the top export destination of Indonesian coal, reached 15.44 million tonnes in August, up 7.15% from July, rising for the third consecutive month, and further climbed to above 21 million tonnes in September, touching the highest this year.
Despite some deviations and corrections, Kpler’s coal-tracking data are highly correlated to data issued by Indonesia’s Central Bureau of Statistics (BPS) and China’s General Administration of Customs (GAC), with the first two being of more consistent.
The GAC data reflects a one-month or so delay compared with that of Kpler and BPS, that is, import numbers of Indonesia coal issued by the GAC in September would be close to August export figures of the BPS or Kpler.
This is understandable given the shipping time and customs clearance procedures that usually take half to one month’s time.
The latest data issued by BPS showed Indonesia exported 15.99 million tonnnes to China in August.
As such, China’s imports of Indonesian coal in September and October will be very likely to increase from August, or even hit a new high this year. Indonesia, as the top source of China’s coal imports, will determine the trend of China’s total coal imports. But the specific amount of coal imports will still depend on the data released by the GAC.
Note: This article has been exchanged under the article exchange agreement between CoalMint and Sxcoal.
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