China April coal imports soar, driven by panic orders in early March
BEIJING (Reuters) – China’s coal imports surged 43% in April from March, driven by panic buying over concerns of supply disruptions stemming from Russia’s invasion of Ukraine.
China shipped in 23.55 million tonnes of coal last month, data from the General Administration of Customs showed on Monday. That compares with 16.42 million tonnes in March and 21.73 million tonnes in April 2021.
For the period of January-April, China brought in a total of 75.41 million tonnes of coal, down 16% from shipments in the same period a year earlier.
China’s coal imports https://graphics.reuters.com/CHINA-COAL/IMPORTS/gdvzyagexpw/chart.png
Benchmark Newcastle thermal coal hit a record high of $440 a tonne in early March, fuelled by fears of tight supply as Western countries vowed to impose sanctions on Russia’s financial system and energy products after it invaded Ukraine. Moscow calls its actions in Ukraine a “special operation”.
As global coal prices stayed high while the Chinese central government ordered miners to boost domestic output and capped local prices, Chinese traders then shunned expensive seaborne cargos in favour of domestic sources.
China aims to churn out a record 12.6 million tonnes of coal each day and maintain coal prices under term contracts at 570-770 yuan ($84.99-114.81) a tonne.
Meanwhile, the country’s state planner in April urged 14 regions, including Guangdong, Guangxi and Zhejiang, which largely rely on imported coal, to sign more term contracts with the top mining hubs of Shanxi, Shaanxi and Inner Mongolia for domestic supply.
Imports of the dirty fossil fuel could also be dented following wide shutdowns of industrial plants across China due to a flare-up of COVID-19 outbreaks.
Coal inventory at major power plants alongside Chinese coastal provinces was about 30 million tonnes in late April, comparing to an average level of about 25 million tonnes in 2016-2021, data compiled by Wind showed.
China’s finance ministry has cut import tariffs for all types of coal to zero – from May 1, 2022, until March 31, 2023 – aiming to ensure energy security amid soaring global prices, but traders question whether it will drive up imports.
($1 = 6.7066 yuan)
(Reporting by Muyu Xu and Dominique Patton; Editing by Kenneth Maxwell and Tom Hogue)