Australia’s thermal coal exports for Nov ’20 stood at 14.6 mn t against 18.5 mn t in October, falling by 21% m-o-m basis, CoalMint vessel-line up data reveals.
Its major importing countries such as South Korea, Taiwan, China, and Vietnam recorded a significant drop in their coal imports from Australia in November.
South Korea has planned to close down up to 16 coal-fired power plants for three months from December (out of its 60 coal power plants in total) to reduce air pollution, leading to reduced demand for coal.
Taiwan and Vietnam have opted for a cleaner and cheaper option in LNG for power generation. By mid-November, the average LNG weekly spot price for Asia dropped to $6.40 per million British thermal units (mmBtu) against a high of $7.50 in the last week of October.
Whereas, the ongoing tension between China-Australia has resulted in Australian coal imports to plunge by 71% m-o-m in November. In fact, the Australian port of Gladstone in Queensland did not ship coal to China in Nov’20 for the first time in nearly a decade.
The few countries that recorded an increase in Australian coal imports in November are Japan 6.19 mn t (up by 1.5% m-o-m), India at 1.97 mn t (up by 57% m-o-m), and Chile at 0.22 mn t (up by 67% m-o-m).
The rising South African coal prices during the month, prompted India cement and power producers to opt for cheaper Australian coal. While the price of 5500 NAR South Africa coal in November was assessed at $66/t CFR India, and for a similar grade from Australia averaged at around $51/t CFR India, making it an attractive alternate to S.African coal.
Port-wise non-coking coal exports
Outlook
With South Korea shutting down its coal-fired plants during winters, the country’s coal imports would fall in December. In case of other Asian countries, LNG prices have got some support due to its increased demand during winters, making countries to again opt for coal. Apart from this, nuclear supply risks in Japan have been raised amid Japanese court ordering the government to revoke the operational permits for the Ohi 3 and 4 nuclear reactors on earthquake safety grounds. This would mean, coal would likely play a key role in balancing electricity supply in the event of weather-driven spikes in demand.
Leave a Reply