China extends Aussie coal bans

Via the AFR:

China’s restrictions on Australian coal are expected to remain in place into next year as Beijing seeks to moderate a spike in foreign imports of the commodity to protect domestic supply.

While there had been hopes in Canberra that the unofficial quota on Australian coal exports to China would be wound back shortly, analysts and traders in China said this week they expected the restrictions to remain in force for a while.

Coal analysts also said there was evidence of intensifying curbs on imported coal, with the major southern Chinese ports of Guangzhou and Fuzhou banning the commodity this week. Both ports recorded a strong increase in imports this year.

Thermal coal is still sitting in the high $60s and coking coal around $150. As things stand, coking coal is right on the budget outlook while thermal is materially below it. I expect both to keep falling next year to an average of $65 and $120, with spikes lower. So both will hit the budget bottom line.

David Llewellyn-Smith
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