03/12/2014 – China’s November coal offtake from Australia’s Newcastle port tumbles to 18-month low


Shipments of coal exports through Newcastle port to China tumbled to an 18-month low in November at 1.47 million mt, down 41.6% from October’s 2.52 million mt, Newcastle coal terminals operator, Port Waratah Coal Services, said in an operating report Monday, December 1st.

The sharp decline in China’s intake of coal exports from Newcastle, Australia, follows Beijing’s imposition of an import tax at a rate of 6% on imported thermal coal from Australia in mid-October.

The collapse in shipment volumes from the PWCS terminals to China in November occurred while spot prices for Newcastle 5,500 kcal/kg NAR thermal coal — the grade preferred by Chinese buyers — skidded to an average last month of $53.80/mt FOB on a 20% ash basis, down from $54.20/mt in October.

China’s import levels for Newcastle coal last dropped to current levels in May 2013, when only 1.34 million mt was shipped that month into the Middle Kingdom, according to PWCS shipping data.

Eighty-eight percent, or 7.92 million mt, of last month’s total shipments of 9.01 million mt from Port Waratah’s Newcastle coal terminals was thermal coal for consumption by power plants for generating electricity, and the remaining 12%, or 1.08 million mt, was coking coal, said PWCS in its report Monday.

In the year to date period, China has taken delivery of 23.66 million mt of coal exports at the PWCS terminals, an increase on 22 million mt in the corresponding 11-month period last year.

Japan increased its offtake of coal exports from the PWCS terminals last month to 4.61 million mt, a month-on-month rise of 36% from October’s shipment volume of 3.39 million mt, said PWCS.

Japan accounted for 51.2% of the 9.01 million mt of coal cargoes loaded on to ships by the PWCS terminals last month, compared with China’s market share of 16.36%, the PWCS data showed.

In the 11-month period ended November, Japanese customers have taken delivery of 45.4 million mt of coal exports from the PWCS terminals at Newcastle port, down from its offtake of 51 million mt for the comparable 2013 period.

Export levels for South Korea from the PWCS terminals were down to 820,000 mt in November from 1.1 million mt in October, but for Taiwan, another important PWCS coal customer, shipments were relatively steady last month at 1.02 million mt, data showed.

For the year to date, South Korean import volumes for Newcastle coal via the PWCS terminals was 13.4 million mt, and for Taiwan the import volume was 10.27 million.



INDIAN OFFTAKE

Indian buyers took delivery of 350,000 mt of coal exports from the PWCS terminals in November, equivalent to a market share of nearly 4%, and the south Asian country’s highest recorded cargo volume since Platts started to track PWCS shipping data four years ago.

India-bound ships have loaded a total of 726,000 mt of coal exports at the PWCS terminals in the past three months, bringing India’s coal offtake for January-November to about 1.2 million mt, or 1%, of total shipments of 101 million mt from the facility over the 11-month period.

The rise in shipments of Newcastle thermal coal to India may indicate attempts by Australian coal exporters to diversify their customer base in the wake of slower demand from China.

Malaysia, was the destination for 365,000 mt, or 4%, of PWCS coal shipments in November, according to the company’s report.

Glencore, Rio Tinto and Idemitsu are among the major coal companies that export cargo through the PWCS terminals at Newcastle port.

Shipment data for Newcastle Coal Infrastructure Group’s terminal at Newcastle port was unavailable for November.

The NCIG terminal is operated by BHP Billiton on behalf of shareholders Centennial Coal, Peabody Energy, Whitehaven and Yancoal Australia.


Source – Platts.com