Asia coal imports seen hitting record in 2011

By Fayen Wong
Thursday June 24, 2010 05:40:03 AM GMT

PERTH, June 22 (Reuters) – Asia’s thermal coal imports are set to hit a record high next year, nearing 500 million tonnes, as economies in the region extend their recovery over the next 18 months, an official Australian forecast showed on Tuesday. Asian exporters, such as Indonesia and Australia, are seen struggling to keep pace with the demand, which could prompt end-users to draw more supplies from Russia and South Africa to fill the supply gap in the Pacific market, the forecasts showed. In its updated June quarterly forecast, the government’s Australian Bureau for Agriculture and Resource Economics (ABARE) said demand for imported coal in Asia would rise by 26.3 million tonnes, or 5.8 percent, to 478.5 million tonnes in 2010, and a further 4 percent to 497.6 million tonnes in 2011. This compares with its previous March forecasts for imports of 445 million tonnes in 2010 and 459.3 million tonnes in 2011. “Increased import demand in China and India is forecast to account for most of this forecast rise, with increased exports expected to come mainly from Indonesia and the Russian Federation,” ABARE analyst Michael Lampard said in the report. China’s thermal coal imports were forecast to increase 7 percent to 98 million tonnes in 2010 and to 103 million tonnes in 2011, as development of higher-cost Chinese mines further inland improved the competitiveness of imports. “A potential downside risk to China’s import demand for thermal coal is associated with the extent to which import coal prices could increase. Sharply higher coal prices would encourage domestic production in China leading to weaker demand for imports,” ABARE said. India, the fastest-growing importer of thermal coal, is forecast to boost imports by 26 percent to 68 million tonnes in 2010 and by a further 13 percent to 77 million tonnes in 2011. Japan’s thermal coal imports in 2010 are forecast to rise by 3 percent to 120 million tonnes as its economy slowly recovers, edging up to about 121 million tonnes in 2011. …

Asia’s thermal-coal imports seen hitting record in 2011