Russian newspaper: North American coal has taken over China

The U.S. has surpassed Russia in supplies to this market. North American coal producers overtook Russian ones in September in terms of coking coal supplies to China and became the largest source of raw materials for China. According to Chinese customs statistics, since the beginning of the year, coal exports from the U.S. and Canada to China have increased by 870.6% and 92%, respectively. This became possible after the ban on imports of Australian coal, which is now redirected to other APR countries. Russian companies are also increasing production, and China will be a major market for them this year. American and Canadian grades are not superior to Russian coal in quality, but lack of transportation capacity prevents serious growth in exports. U.S. and Canadian coal producers are actively increasing their share of the Chinese coking coal market, according to the Chinese customs statistics cited by Argus. For the first nine months of 2021, the U.S. increased shipments by 870.6%, to 7.2 million tons, and Canada by 92%, to 6.6 million tons. Russian coal miners also showed growth by 77.4%, to 7.7 million tons. The market changes come amid the unofficial ban on imports of Australian coal imposed by the Chinese authorities. In 2020, Australia was the absolute leader in coking coal exports to China, supplying 35.37 million tons out of 72.57 million tons of total imports. After the ban, Australian coal export flows were directed to Japan, South Korea, India, and Vietnam. Another major supplier to China, Mongolia, is unable to take advantage of the market opportunities that have opened up. Mongolian coal imports to China fell 35.8% to 10.6 million tons in the first nine months of 2021. At the end of August, writes Argus, due to new cases of COVID-19, the movement of trucks with coal through the border between Mongolia and China was stopped. After customs clearance resumed, the number of passing trucks remains limited. MMK's steel market report stated that prices in China's domestic market reached $510-520 per ton. Meanwhile, coking coal futures have been declining over the past few days due to the Chinese government's statements about possible interventions, as well as its attempts to stimulate domestic production. Soaring energy prices are paralyzing the industry in Europe and China Coal production in Russia this year, according to the Ministry of Energy, will increase by 6%, to 425 million tons, and China will be the main market for Russian coal this year. "China is not our biggest consumer, although it will regain the title at the end of 2021. Our top importers are South Korea, Japan and China. We have a presence in Taiwan, a good vision for Vietnam, there are prospects in Africa as well," Sergey Mochalnikov, Director of the Department for Foreign Economic Cooperation and Development of Fuel Markets at the Ministry of Energy, told RIA Novosti. Sergei Grishunin, managing director of the NRA rating service, said the U.S. and Canada have been very big players in the export market for coking coal with delivery by sea in the past. After prices fell in 2018, a large number of U.S. producers went bankrupt, but existing port infrastructure capacity now allows U.S. companies to multiply shipments. In Russia, the expert says, unfortunately, the infrastructure capacity in the Far East is still limited. "Therefore, the main problem of Russian suppliers, as always, the lack of coal export capacity. The quality of American and Canadian coals is not much higher than that of Russian grades, so the issue is exactly the convenience of delivery," Mr. Grishunin comments.