SOURCE / ECONOMY
China’s coal imports from US in September jump
Published: Oct 28, 2021 09:58 PM
A machine unloads coal imports at a port in Lianyungang, East China's Jiangsu Province, on December 3, 2016. Photo: CFP

A machine unloads coal imports at a port in Lianyungang, East China's Jiangsu Province, on December 3, 2016. Photo: CFP





China imported more coking coal from the US and Canada combined than from Russia in September, making the North American region China's largest coking coal supplier, Russian media outlets have reported, citing the latest Chinese customs data.

This record surge in a short timeframe indicates the growing demand for diversified coal supplies, ignited by power shortages in China, the need for epidemic prevention on the border region and the China-US trade deal, industry insiders said.

China's coal imports from the US soared 870.6 percent in the first nine months of the year to 7.2 million tons, while its coal imports from Canada rose by 92 percent to 6.6 million tons, according to Sputnik News. By comparison, coal supplies exported to China from Russia jumped 77.4 percent to reach 7.7 million tons. 

Coking coal, which is used for making steel, is seeing a demand hike amid shortages, further boosted by lower transport efficiency and inadequate transport capacity on the borders with Mongolia and Russia, two major coal suppliers for China, partially due to the need for epidemic prevention, an industry insider told the Global Times on condition of anonymity.

"Lower logistics efficiency at border ports between China and Mongolia because of the epidemic, along with the ban on Australian coal, pushed traders to expand imports from the US and Canada to fill the gap," Zhao Yang, co-founder of Chinese coal market information site Meitan Jianghu, told the Global Times on Thursday.

China imported 4.35 million tons of coking coal in September, down 7.18 percent month-on-month and 35.3 percent year-on-year, while the US once again became the top source of coking coal imports for China in September. The US was the largest source of coking coal imports in April and August. 

High coal prices explain the jumping imports of North American coal, especially from the US. It's become very profitable for such exporters to meet increasing coal demand in China, Lin Boqiang, director of the China Center for Energy Economics Research at Xiamen University, told the Global Times on Thursday.

Other important reasons, such as the trade deal, also count. Expanding energy imports from the US can reduce the trade deficit and the sensitivity of the trade issue - a similar reason as the high level of imports of US natural gas and oil, Lin said.

During calendar 2020 and 2021, compared with 2017 as a base, China will expand its purchases and imports of manufactured goods, agricultural products, energy products and services from the US by no less than $200 billion, according to the China-US phase one trade deal.

While the demand for coal and steel will continue for the rest of the year, China's expansion of coal supplies will last for some time.

"Coal reserves are now around 17 days, and the normal period should be 20 days," Lin said.

But since the country is embracing clean energy, strong demand for coal will not be a long-term trend, and the price is not cost-effective either, the expert said.


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