The daily coal haul by Mongolian trucks to China rebounded in mid-October after heavy rain disrupted logistics in early September, leading to higher availability of metallurgical coal supplies in China, sources said Oct. 21.
In the week to Oct. 18, the number of trucks bringing Mongolian coal to China via the land port of Ganqimaodu surpassed 1,000, higher than around 700 trucks in early September, according to Shanghai-based consultancy SDIC Essence Futures and the China Coal Economic Research Association.
In early September, coal haulage to China suffered due to torrential rain in Mongolia, which weighed on coal movement, sources said.
This coincided with a lack of storage capacity at supervised warehouses at the Ganqimaodu port. Traders were also not eager to make purchases, impacting Mongolian coal haul at the time, analysts with the China Coal Economic Research Association said.
Rising inventories in China
However, Mongolian coal supplies have picked up in recent days, sources said, which has also led to a rise in coal inventories in China.
China’s met coal supply in the week to Oct. 18 improved as key mines’ run rates reached 87.2%, edging up 0.2% on the week, analysts with China-based consultancy Ruida Futures said. The daily average output reached 1.97 million mt, up 5,000 mt on the week, adding to supply pressure at coal warehouses.
China’s total met coal stocks reached 21.04 million mt in the week, up 2.2 million mt on the year, on rising inventories with end-users and at ports, according to the consultancy East Asia Futures, or EAF.
The steel sector had 7.36 million mt in stocks, up 10,300 mt on the week, while the washed coal sector had 1.73 million mt, EAF data showed. The coke sector, another key end-user of met coal, reported 9.57 million mt of inventories in the week to Oct. 18, up 47,400 mt on the year.
In the same week, met coal stocks at key Chinese ports reached 4.11 million mt, up 2.18 million mt on the year.
Meanwhile, spot trade in China in the week weakened slightly, mostly because the last round for replenishing coal stocks ended after markets resumed following the week-long Golden Week holidays, SDIC analysts said.
Source: Platts
