In its latest weekly report, shipbroker Banchero Costa said that “so far in 2022, global coal trade has been a bit of a mixed picture. In the January to August period of 2022, total global seaborne coal loadings increased by +2.2% y-o-y to 784.9 mln t, from 767.7 mln t in the first 8 months of 2021, but still well below the 853.6 mln t in the same period of 2019. However, the worst was at start of the year, and the trend in recent months has been very positive. In 1Q 2022, global coal loadings were down -5.1% y-o-y to just 258.5 mln t. In 2Q 2022, coal loadings were a strong +7.7% y-o-y at 314.0 mln t. The month of June 2022 was actually a record 111.8 mln t, +12.6% y-o-y. August 2022 saw an equally strong 109.5 mln tonnes loaded, which was up +22.1% year-on-year from August 2021 and indeed even higher than the 106.0 mln t of August 2019.
According to Banchero Costa, “mainland China’s seaborne coal imports in the first 8 months of 2022 have overall been disappointing. In the January to August period of 2022, China imported 134.0 mln tonnes, which represents a steep -18.1% y-o-y decline from the 163.6 mln tonnes imported in the same period of last year. It was also significantly below the 178.1 mln tonnes imported in the same period of (pre-Covid) 2019. That said, also here the worst was at the start of the year, and the trend has been of gradual improvement throughout the year. In 1Q 2022, China imported just 38.8 mln tonnes of coal, down -35.0% yo-y from the same quarter of 2021. In 2Q 2022, imports increased to 49.2 mln tonnes, which was +26.6% up from the first quarter, and just -16.6% down y-o-y from 2Q 2021. In the month of June 2022 imports surged to 22.9 mln tonnes, more than twice the levels of January and February, and +9.6% y-o-y from June 2021. In July 2022, they increased further to 23.1 mln tonnes, the highest monthly figure since the 24.1 mln tonnes of August 2021. Power utilities in China sought overseas supplies to meet soaring demand in extreme hot weather. As severe drought and heatwave hit western and southern China from late July, coal-fired power plants geared up production to meet the spiking demand for air conditioning and the supply gap from hydropower stations. They also increased purchases of higher quality thermal coal, such as Russian coal, to improve electricity generation efficiency”.
“China now accounts for 17.3% of global seaborne coal imports, second only to India with 18.3%, and ahead of Japan with 15.0%. In terms of trading patterns, things are changing quite a bit. Indonesia is still by far the top supplier of coal to China, accounting for 57% of China’s imports so far in 2022. Arrivals from Indonesia however declined by -23.1% y-o-y to 76.4 mln t in the first 8 months of 2022. The second largest supplier is now Russia, accounting for a 24.8% share.
Shipments from Russia to China increased by +19.9.2% y-o-y to 33.2 mln t so far in 2022, from 27.7 mln tonnes in the same period of 2021. On a monthly basis, volumes from Russia to China reached an all-time record of 7.4 mln tonnes in July 2022 (+81.8% y-o-y) and then declined to a still impressive 5.9 mln tonnes in August 2022 (+38.8% y-o-y). Imports from Russia have surged in recent months as Europe suspended purchasing from the country Prices for Russian coal have climbed as both China and India stepped up buying, traders said, but were still cheaper than the domestic coal of same quality. Russian thermal coal at 5,500 kcal on delivery basis to China was assessed at about $155 a tonne in late August. Shipments from the USA to China declined by -49.8% y-o-y to 3.5 mln t in Jan-Aug 2022, from the record 7.0 mln tonnes in the Jan-Aug 2021. Volumes from South Africa have also declined by -38.8% y-o-y to 5.3 million tonnes, from 8.7 million tonnes in the same period last year”, the shipbroker concluded.
Source: Hellenic Shipping News
