What next with China’s coal import up 32 % YoY in April?
Klaveness customers and clients receive a comprehensive dry bulk research report on a weekly basis. The below is an extract from one of the topics addressed in the week 18 report. China imported 24.8Mt of Coal in April. The import is up 32% from April last year and 16% compared to March in annualized terms. YTD import volumes are 89.5Mt, up 33% as compared to last year (67.2Mt). A full breakdown of the imports will be released later in the month.
Klaveness Research says:
The Year on Year growth rebounded from +12% in March. A strong Year on Year growth number, especially as imports from North Korea in April this year is likely to be zero, compared to 1.5Mt in April last year. With domestic Chinese availability improving, imports in May and June will be under pressure.
The general activity level/electricity consumption/hydro production will be the main drivers for overall coal demand in China in the second half of 2017. However, the most important drivers for Chinese coal imports will be government policies. 1) Will the government return to a 276 working day policy for domestic coal mines if prices drop from the current 612 yuan (5,500cv, FOB QHD) to a level below the previously communicated thresholds of 600 and 570 Yuan? 2) To what extent will China curtail import of “low quality coal” as they have been mulling about recently?