China’s August coal imports rise as demand for cooling surges

Smoke and steam rise from a coal processing plant in Shanxi Province. — AP

SINGAPORE: China’s coal imports rose in August to their highest this year, as power generators sought additional supplies from abroad to meet surging electricity demand amid the baking temperatures of a heatwave.

The world’s biggest coal consumer brought in 29.46 million tonnes of the fossil fuel last month.

This was up from 23.52 million tonnes in July, data from the General Administration of Customs showed.

August arrivals were also higher than the 28.05 million tonnes of a year earlier.

But China’s imports in the first eight months were still down 14.9% from a year ago, to 167.98 million tonnes, as it cranked up domestic output.

A government-imposed price cap on domestic thermal coal is encouraging utilities to source supplies from Chinese mines.

Coal-fired power generation spiked in August because the dry, hot weather curtailed hydropower generation and stoked demand for air conditioning.

Daily coal consumption reached 2.36 million tonnes at eight major coastal regions in mid-August.

This was up 11.5% from a year earlier, data tracked by the China Coal Transportation and Distribution Association showed.

Power plants in southern China sought tenders in August for more supply, asking for medium and low-heating value coal from Indonesia.

Coal-fired power generation has gradually declined since late August.

This was because temperatures have fallen and industrial activity has remained curbed by Covid-19 restrictions.

Daily coal use in the coastal regions averaged 2.18 million tonnes last week, 2.5% higher than the same period in 2021.

But because some parts of north-east China will begin winter heating in early October, power utilities are expected to replenish stocks beginning in late September.

This is forecast to drive up coal imports substantially. — Reuters

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