According to Reuters, Chinese coal traders have stopped ordering Australian coal as clearing times through China’s customs have doubled to at least 40 days, according to major buyers in China and international coal merchants, resulting in a sharp fall in Australian prices. China is thought to have imposed additional import restrictions to Australian coal in many ports in the country’s northeast, aiming to take advantage of its own domestic coal capacity and boost coal prices.
Although Australia has been the largest coal exporter to China through the years, as Australian ABC stated, the current restrictions resulted to many coal-carrying vessels to wander near China’s coastlines, waiting for further instructions.
In addition, Tania Constable, CEO of the Minerals Council of Australia, commented that companies were concerned on the restrictions and the uncertainty is rising.
We believe an unofficial quota system has been employed since the restructure of customs and quarantine administrative arrangements in October 2018.
… Constable addressed.
Moreover, customs clearance commonly takes 5 to 20 days. This time the clearance can take up to 45 days.
On the other hand, BHP Group denied the allegations that China aimed at restricting Australian imports specifically and supported that China’s decision reflected its effort to balance domestic production versus imports.
Finally, global traders confirmed the delays.
Yes, the Chinese ports are holding up all thermal shipments ex Australia for 40-60 days…My clients are only buying spot Indonesian coal.
… Quoted to Reuters an Australian coal trader, who asked not to be named due to company policy.