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Australian thermal coal exports to China under pressure

Coal News - Published on Fri, 22 Mar 2019

Image Source: reported that Australian thermal coal exports to China are under increasing pressure, with indications import restrictions are spreading to other key ports. Platts reported restrictions targeting Australian thermal coal had spread to the southern port of Fangcheng. It follows reports last month thermal coal imports were being held up indefinitely by customs officials at the northern port of Dalian. The Platts report quoted unnamed sources saying customs officials were conducting tests for radioactivity in Australian coal. Platts' source suggested the impact of the new test regime could see coal taking three months to finally clear customs.

An Australia-based trader told Platts "The price movement is not really due to the effect of market forces, but more policy-related. Australian producers are looking to sell their cargoes, but there's not a lot of business, so prices will likely to further soften if this persists."

The commodities team at investment bank Credit Suisse says importers are now avoiding some lines of thermal coal destined for China's power generation industry. Credit Suisse said "Australian high-ash coal designed for the China market is being belted relative to competitor coals, suggesting that prospective buyers are steering clear on the fears of being stranded with a distressed cargo if they can't land the material in China."

Both the Chinese and Australian governments have played down talk of import bans, but many market observers suggest Australian coal appears to have been targeted either officially, or unofficially.

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Posted By : Rabi Wangkhem on Fri, 22 Mar 2019
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