China and India increase seaborne thermal coal imports

Source: China Ocean Shipping e Journal

Seaborne thermal coal imports from China and India rose to a three-month high in March.

China, the world's largest coal producer and importer, imported 29.7 million tonnes of seaborne thermal coal in March, up from 23.03 million tonnes in February and 28.62 million tonnes in March 2023, according to commodity data provider Kpler. In the first quarter of this year, China's seaborne coal imports for power generation were 80.64 million tons, up 17.2 percent from 68.82 million tons in the same period in 2023.

The strong growth in China's coal imports is partly due to rapid growth in electricity demand and partly because seaborne coal is more competitive than domestic coal. China's electricity consumption rose 11 percent in January and February from a year earlier, and power generation rose 6.9 percent, outpacing economic growth of 5.2 percent, according to official data. Domestic coal prices are relatively high compared with overseas coal, and Qinhuangdao Thermal Coal closed Monday at 825 yuan ($114) a ton. Australian coal, rated by commodity price reporting agency Argus, fell to $87.37 a tonne in the week ended March 28. Indonesian coal closed last week at $55.70 a tonne. Even taking into account differences in freight rates, import duties and calorific value, imported seaborne coal is currently priced slightly lower than domestic supply.

China imported 20.24 million tons of Indonesian thermal coal in March, up from 16.96 million tons in February. Thermal coal from Australia hit a three-month high of 5.08m tonnes, with 3.45m tonnes imported in February. It was a similar story in India, where strong growth in electricity demand drove coal imports to 15.21 million tonnes in March, up from 14.09 million tonnes in February and 13.41 million tonnes in March 2023, according to Kpler. The country imported 42.79 million tons of thermal coal in the first quarter, up 23.8% from 34.57 million tons in the same period last year.

Market analysts believe India's coal demand will remain high as the South Asian country experiences a heatwave from April to June, with maximum temperatures above normal in most areas. India's largest seaborne thermal coal supplier is Indonesia, which imported 10.23 million tonnes in March, the highest level in four months.