China’s coal imports in the first two months of 2023 surged 71% from a low base a year earlier as utilities replenished stocks in anticipation of greater demand after the country abandoned its zero-COVID policies.
China, the world’s largest coal consumer, imported 60.64 million tonnes of coal during January and February, up from 35.39 million tonnes in the same period last year, customs data showed on Tuesday. Data for the two months is combined due to the week-long Lunar New Year holiday that began in late January.
Utilities stepped up purchases of cheap thermal coal from Indonesia, while arrivals from Mongolia also picked up following the easing of COVID restrictions.
Beijing’s U-turn on its COVID-19 strategy in late 2022 has stoked hopes for an economic rebound this year that would boost power and coal consumption.
Analysts from Wood Mackenzie said in December they expected China’s coal demand to increase 2% this year.
China in January partially eased an unofficial ban on Australian coal imports amid a rekindling of diplomatic ties between the two countries.
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At least eight vessels hauling 700,000 tonnes of Australian coal have reached Chinese ports since then, shiptracking data showed, but shipments will take time to be cleared by customs.
Some Chinese utilities and traders have placed orders for March-loading cargoes.
However high coal inventory levels at Chinese ports and utilities amid a slower-than-expected recovery in demand from downstream sectors could limit China’s coal imports in the near term.
Utilisation rates at major coastal power plants fell to between 50% and 60% in late February from about 70% in January, as residential heating demand declined amid warmer weather, traders said.
Coal stocks at key northern Chinese ports fell from a near three-year-high level hit in mid-February but remain much higher than during the same period over the past five years, industry data shows.