China imposes coal import tariffs

The Chinese Ministry of Finance has announced it will reimplement import tariffs of 3% on coking coal, among other types, from 1 April with the aim of supporting domestic producers. The tariffs were previously removed in May as the country aimed for energy security amid a period of soaring coal prices. Coking coal liftings destined for China totaled 28.4 MMT in 2022, a decline of 24.9% YoY and the lowest level in over 5 years. Seaborne imports saw a modest revival in 2H22 as Covid-19 disruptions in Mongolia and China’s western coal producing regions hampered supply chains. The easing of Covid-19 restrictions in December, however, should relieve supply chain pressures within China and thus drive greater domestic substitution of seaborne coking coal volumes in 2023. Despite being subject to the 3% tariff too, Mongolia’s proximity to China and cost-effective rail network will also allow mills to achieve lower prices than can be attained from suppliers further afield.

Chinese bauxite imports strong in December

China imported 12.4 MMT of bauxite in December, rising by 46.3% YoY as seaborne volumes continue to grow for this commodity. At 9.4 MMT, the Capesizes realized most of the benefit as its share of total shipments increased to 75.2% of volumes, the second highest on record. Imports from Guinea totaled 7.9 MMT in December, more than doubling YoY and matching the highest level for this trade in the month previous. Meanwhile, arrivals from Australia increased by 5.5% YoY to 3.2 MMT and Indonesian volumes declined by 35.3% YoY to 1.2 MMT. The strength in bauxite imports has been matched by continued growth in the country’s alumina production, which increased by 12.4% YoY to 6.8 MMT in November.