Fri, February 9, 2018 10:15 am
According to preliminary customs data, Chinese coal imports increased significantly to 27.81 mm MT in January, rising 22.3% seq and 11.6% YoY and reaching the strongest month in four years since the country imported 35.90 mm MT in January 2014. The jump is not surprising, given the news that we’ve shared with you about China’s unsuccessful push to gas for home heating, colder than normal winter temperatures, heavy snowfall, lack of rail capacity, strained supply and rocketing domestic prices. To combat the coal shortage, authorities reversed previously implemented policy on import controls, as well as reallocated rail wagons in efforts to rebalance supply with demand. Over the next few weeks, as the entire country celebrates the Lunar New Year, utility demand typically eases as industry takes a weeklong holiday and we have heard of some coal producers shortening or entirely cutting the usual holiday period, as coal suppliers work to catch up with demand. The Chinese heating season typically ends in mid-March when the weather warms. In 2017, China imported a total of 271.1 mm MT, 6.1% above 2016 but well below the annual record set in 2013 of 323.9 mm MT. Meanwhile, China’s exports of coal fell 59.4% seq and 51.9% YoY to just 281K tons in January.