South African monthly coal export declined by 19% in Oct’16 compared with last month. While, coal export also recorded a drop of 13% Y-o-Y basis.
South Africa, one of the largest thermal coal exporters in the globe shipped about 6.5 MnT of coal to the different destinations in Oct’16. The monthly coal export down by 19% compared to Sep’16 and also recorded a significant fall by 13% compared to Oct’15.
Out of the total exported quantity, more than 90% is Bituminous coal shipped by the country every month and rest includes Anthracite, coke and other grades.
South African Coal Export in 2016
In the first nine month of the year, the country has exported 61.8 MnT coal with a marginal fall of 5% which was at 64.7 MnT in the same consecutive period last year.
Country-wise Coal Export in 2016
South Africa shipped large quantity to India about 32.67 MnT coal during Jan-Oct’16, registered a significant growth of 10% compared to last year. While, Pakistan and Italy emerged as the 2nd and 3rd largest destination for South African shipments during the period.
India increased imports of South African coal in FY17
India is one of the largest buyers of South African thermal coal, country’s whole sponge and Cement industry is largely dependent on South African coal. Out of the total exports of the year the country has shipped more than 60% of coal to India.
But there was on speculation that imports will come down in FY17 owing to less demand of South African coal by Cement plants (about 85-90% shifted to Pet coke) coupled with sharp hike in global prices. In contrast India’s thermal coal import from South Africa has increased by 5% (Apr – Oct’16) compared to last fiscal.
However, India’s coal sourcing trend from South Africa is highly volatile in FY17. South African coal prices have seen a peak and hit the highest of years since May’16. Which caused sudden fall in Indian imports by 20% during Jun-Aug’16, compared to last year. The offers have crossed the level of USD 100/MT, FoB at the end of Oct’16.
Post witnessing fall, the country’s coal (South African) imports have risen by 18% in Sep’16-Oct’16 owing to supply shortage of Indonesian coal in the market. Because China was very aggressive in Indonesian coal buying owing to domestic supply crunch.
Indonesian supply Shortage Impact on Indian Coal Imports
Indonesia largely supply coal to India, China, Japan and Korea which caters about 74% of its yearly coal exports. Indonesia exports about 57% coal collectively to India & China every year; they play a major role in import market.
On one hand when South African imports rose in India, on the other hand Indonesian supply was down by 10% (Sep-Oct’16) Y-o-Y. While it is also heard in the market that owing to supply tightness of Indonesian grades in the market, India fulfilled its requirement through other substitutes.
Meanwhile, Chinese utilities were ready to pay high price which was profitable for Indonesian sellers to deal with China rather India or other countries. Though, very less Indonesian cargo was available for spot bookings which reduced deals from India.
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