Thermal coal trade in Asia in 2023 is set to outpace 2022 by 17%, with the biggest driver of this rise being China’s stockpiling of coal, while Vietnam more than doubled imports in the first eight months of 2023, according to the latest Resources and Energy Quarterly report published Dec. 18. The report, which carries the Australian chief economist’s official forecasts for the country’s major commodity exports, stated that world imports are expected to drop by 2.1% in 2024 to allow high inventory levels to normalize, before resuming in 2025 with a 1.5% increase.

“Energy security concerns borne of geopolitical tensions have prompted China to stockpile coal inventories to record levels in 2023. China’s coal inventories have more than tripled over the last couple of years,” the report noted, adding China’s coal-fired power output rose in 2023 despite its announced target of reducing output. Chinese coal imports are forecast to slip to 221 million mt in 2024 and 231 in 2025, down from 302 million mt this year, the forecast showed.

Meanwhile, demand for Australian thermal coal exports remained high in 2023, with shipments to China rising steadily over H1 2023, reaching a peak in June 2023 during China’s peak summer demand. With better weather conditions and increased production from several mines, the forecast stays that export volumes will experience minor growth, from 182 million mt in 2022-23 to 203 million mt by 2024-25.

Source: The Coal Trader | thecoaltrader.com