|4/19/2017 by mdc|
|Keith Williams provides a summary of Chinese activities in coal as of 2017 ...|
1. China continues to experiment with setting a price for coal by manipulating local production.
2. China bans coal imports from North Korea in 2017 and Mongolia dramatically increased export of coking coal to China in 2016.
3. International coal producers, Indonesia, Australia to benefit, but what about Mongolia?
4. Experts do not think this reflects a fundamental shift in coal industry decline.
5. Paris climate agreement ratification continues, record global temperatures three years in a row reinforce the urgency of greenhouse gas emissions reduction, especially in China.
6. Last year, China changed the fortunes of Australian and Indonesian coal miners with a brutal cut of 9.4% in local coal production. This led to expansion of coal exports from Mongolia, North Korea, Australia and Indonesia, and substantial price increase for exported coal, both thermal and coking. The effect was so dramatic that China partially reversed the cuts to allow local production boost for the 2016/2017 winter.
China gets tough with Korea and stops buying its coal as of today It started with a warning, when a 16,300 tonne shipment of coal from North Korea was rejected. The explanation given was that the shipment contained a higher than allowed level of mercury. Now China has announced a ban of all coal imports from North Korea for the rest of 2017. This ban is a consequence of tensions due to a recent North Korean missile tests and diatribe.
Note that the ban by China follows UN sanctions on North Korean coking coal exports (essentially all of which goes to China) for 2017 of 7.5 million tons. In 2016, China imported 22.5 million tons of coal from North Korea. The political significance is that the coal exports to China make up about a half of North Korean export income. Williams assume that this is China saying to North Korea to stop playing games in developing nuclear weapons.