In January-February, China’s Imports of Coal From Russia Increased, While Supplies From Australia Resumed

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China imported a record amount of coal from Russia in the first two months of 2023, driven by a surge in domestic restocking demand. This rise is despite China operating under a zero-COVID regime since mid-February, indicating the nation’s increasing reliance on Russian coal.

The increase in China’s imports from Russia comes as Beijing looks to shore up its energy security and reduce its dependence on imports from Australia, a major supplier whose shipments were disrupted due to political tensions between the two countries.

Russia becomes second-largest coal supplier to China

According to data from the General Administration of Customs, Russia supplied China with around 14.8 million tonnes of coal during the first two months of 2023. This amounts to an average daily delivery of 250,892 tonnes, making Russia the second-biggest coal supplier for China after Australia.

The rise in Russian coal imports is a response to the disruption in shipments from Australia due to strained political relations between the two countries.

According to Reuters, “China sharply increased coal imports from Russia after its invasion of Ukraine as Western countries shunned trade with Moscow, which pushed down Russian coal prices and attracted buyers that did not implement sanctions.”

Russian Transportation Infrastructure

Since October, Russian transportation infrastructure limitations have hindered coal exports to China, and traders expect the problem to persist. The need for adequate transportation links has been a significant factor in limiting the flow of Russian coal, with railway capacity often falling short of demand.

According to customs data, 207,236 tonnes of Australian coal entered China in February – the first since Beijing lifted an unofficial ban in early January – as the two countries attempt to rebuild ties.

Analysts have noted that prices for Russian coal are significantly lower than those from other countries, making it more attractive for buyers. With tensions between China and Australia showing no sign of abating anytime soon, this trend toward increasing reliance on Russian coal will continue.

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