Japan’s Prime Minister, Fumio Kishida, announced on Friday that Japan will impose ban on Russian coal imports. The Japanese government has not established a date for Russian coal ban, with Minister of Economy, Trade and Industry Koichi Hagiuda stating that it will be phased out in stages.

According to UN Comtrade data, Japan imported 20 MMT, 22 MMT, and 20 MMT of coal from Russia in 2019, 2020, and 2021, respectively. Japan’s total coal imports were 186 MMT, 174 MMT, and 183 MMT in 2019, 2020 and 2021, respectively. Hence, Russian coal to Japan contributed to 11% of Japan’s total coal imports.

Furthermore, Russian coal is primarily supplied to Japan from Vostochny and Vanino in Russia’s far east, according to media reports.

Thus, more coal supplied from either Australia or Indonesia would therefore increase tonne-mile shipping demand. Of note, Australia, and Indonesia supply Japan with 110 MMT and 26 MMT of coal on average, respectively, which account for 60% and 15% of Japan’s total coal imports.

In addition, Panamax vessels account for 55% of coal shipped from Russia to Japan, according to our AIS data. As Japan seeks to move away from Russian coal, a shift to more coal imports from either Australian or Indonesian would likely benefit Panamax vessels going forward.