Coal traders will be paying attention to how easily the shipments pass customs for signs that the informal ban is truly over and in the hope of sending more Australian coal to China. — Reuters
SINGAPORE: China is set to soon receive at least two shipments of Australian coal, according to traders and shiptracking data.
These would be the first transactions since an unofficial ban on imports in 2020 was lifted last month.
Coal traders will be paying attention to how easily the shipments pass customs for signs that the informal ban is truly over and in the hope of sending more Australian coal to China.
Australian thermal coal for power generation and metallurgical coal for steelmaking are preferred by Chinese consumers for their high quality. China’s coal demand is forecast to rise in the upcoming months amid an expected economic rebound after Beijing rolled back its strict zero-coal policies.
About 72,000 tonnes of metallurgical coal was loaded onto the bulk vessel Magic Eclipse at Hay Point, Australia, on Jan 23 and is expected to arrive at the southern Chinese city of Zhanjiang in Guangdong province next week, Refinitiv and Kpler shiptracking data showed.
China’s top steelmaker, Baowu Group, bought the cargo, according to a trader familiar with the deal and the shiptracking data.
Baowu is one of the four government-backed firms given permission by China’s state planner in early January to purchase Australian coal.
The company has 12.25 million tonnes of annual steelmaking capacity at its Zhanjiang base.
Baowu did not immediately respond to Reuters’ inquiry seeking comment.
Another bulk vessel, the BBC Maryland, is carrying about 12,000 tonnes of thermal coal from the Australian port of Newcastle and heading to the eastern Chinese city of Changshu, Kpler data showed.
The cargo is scheduled to arrive on Feb 10, but it was not immediately clear who the buyer was.
According to Reuters, China Energy Investment Corp purchased at least two shipments of Australian coal in early January.
China’s local media reported that the other two firms that had been given approval to buy Australian coal had also placed orders.
Other Chinese utilities and steelmakers that are not on Beijing’s list of approved importers are still waiting to resume imports.
Customs officials in five major eastern and southern Chinese cities have said that there is no specific requirement for companies importing Australian coal during the customs declaration process.
However, it was unclear if the customs authorities would clear cargo purchased by companies other than the four approved ones.
Australian thermal coal with a heating content of 5,500 kilocalories was assessed at about US$132 (RM560.60) a tonne on a free-on-board basis last week, down from about US$137 (RM581.8) a tonne in early January, according to traders.
Premium low-volatility coking coal for delivery on a cost and freight basis to China was assessed at about US$320 (RM1,359) a tonne last week, up from US$315 (RM1,338) in early January, the traders added. — Reuters
