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China's to boost coal as hopes for end Australian import

Coal News - Published on Mon, 29 Apr 2019

Image Source: RenewEconomy
SMH reported that China's decision to boost its domestic thermal coal mining industry has raised hopes the country's unofficial restrictions on Australian imports may soon end. Australian thermal coal has faced lengthy customs delays at Chinese ports and debate has raged on whether the restrictions were driven by political or economic motivations. When restrictions were first reported, some experts suggested China was punishing Australia for its ban on telecommunications company Huawei.

However, coal miners said restrictions were frequently put in place to allow Chinese domestic operators "time to shine" and build them up by pressuring Australian producers.

Macquarie Bank's latest research said China's indefinite import quotas had boosted domestic thermal coal supplies after the sector slowed down last year, giving miners hope the restrictions could soon lift.

Macquarie sales and trading analysts said that “China’s local spot thermal coal prices have lifted over the last two months – unlike those of the seaborne market – supported locally by a slowing in the recovery of its mine supply rate and government-imposed restrictions.”

China-based Wood Mackenzie analyst Nuomin Han said the Chinese government had approved more domestic coal mines, lifting production levels.

A mining industry source close to the issue, who preferred to remain anonymous, said China’s aim was to put its coal sector on the front foot to help boost its broader economy.

He said that “They could be trying to cope with a slowdown in the Chinese economy. When they’re facing slowdowns they fire up their traditional industries to act as a cushion for other sectors. Conversations we're having suggest these restrictions might start to relax by the end of May."

Source :

Posted By : Rabi Wangkhem on Mon, 29 Apr 2019
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