Melbourne — BHP said on Oct. 14 that it has been asked to defer some shipments of coking coal to China because of new restrictions imposed by the Chinese government on Australian coal imports.
BHP chairman Ken MacKenzie told the media after the company's annual general meeting in Melbourne on Oct. 14 that there were "new developments relating to how China plans and moderates imports versus its own domestic coal production."
"Our commercial team has recently received deferment requests from some of our Chinese customers," Australian media reported MacKenzie as saying.
Coking coal exports from BHP's Hay Point coal export terminal in Queensland have already been falling this year. Exports in the July-September quarter stood at 10.8 million mt compared with 12.4 million mt in the same period a year earlier, North Queensland Bulk Ports Corporation data shows.
Total coal exports from Queensland ports Hay Point, Dalrymple Bay, Abbot Point and Gladstone fell 9% year on year in September to 15.95 million mt in total, which was 4% lower than in August.
Export data from Gladstone, which is the only port to provide destination information, showed that just 142,000 mt of coal was exported to China in September, down 82% month on month and 11% lower on the year.
Chinese mills have expressed concerns that domestic coking coal and coke prices will increase further, squeezing steel mill margins. Some said they had to hurriedly seek out alternative domestic suppliers as they were no longer able to import.
In response to the import restrictions, Chinese mills and traders have been looking to re-sell imported cargoes, which has put pressure on seaborne coking coal prices. S&P Global Platts' had assessed Premium Low Vol hard coking coal price down $1/mt on the day at $123/mt FOB Australia on Oct. 14.
The price averaged $123.85/mt FOB Australia in September, which was the strongest month since April, Platts data showed.
China has been trying to support its domestic coal industry by imposing import quotas, but many in the market feel the increased tensions between Australia and China have also contributed to the move to restrict Australian coal imports.
Source: S&P Global Platts |
