The Australian government is seeking an explanation from Beijing over reports that China has suspended its purchase of Australian coal due to diplomatic tensions between the two countries.
“We are in contact with Chinese authorities regarding this estimate,” Trade Minister Simon Birmingham told Sky News on Tuesday. We are taking adequate reports from the Chinese authorities to try to ensure that they respect China’s terms. -Australia Free Trade Agreement and their WTO obligations. “
The ban is a sign of rising tensions that have pushed agricultural exports from China’s largest supplier of goods. Beijing has objected to several of Canberra’s political moves in support of the United States in trade and security disputes with China. Among other things, in April, Prime Minister Scott Morrison asked for permission in the Chinese city of Wuhan to investigate the origin of the coronavirus in an independent investigation.
According to the country’s industry department, China is Australia’s top consumer of metallic coal. According to a report released last month, exports of steel-made materials are projected to fall to 23 23 billion (16 16.6 billion) in the 12-month period from June 30.
After Japan, Asia is the second largest exporter of thermal coal to Australia. Annual export earnings in that market will increase from २० 20 billion in fiscal year 2001 to $ 1 billion.
Fossil fuels were an earlier target of China’s Eyre as a growing hostile government in Canberra, most recently in 201 when shipments were delayed at the port. Thermal coal is one of the few sources in which China is largely self-sufficient.
High-quality coking coal is a different story. China produces less of that, and the country’s steel-making giants, Australia, still rely on foreign suppliers like Australia, which typically import more than half.
Newcastle benchmark thermal coal prices fell nearly four years on Monday, and news of the ban hit the market. Australian coking coal prices have also fallen by less than 1 per cent.
“Trade with China varies based on a number of factors, including quotas,” said Tania Constable, chief executive of the Australia Minerals Group. Australia will continue to demand high quality of its coal. The medium-term outlook remains positive. “
China has tightened its grip on coal imports as it seeks to balance the needs of its miners and industrial users, and the Australian government had expected shipments to decline as Chinese imports fell later in the year.
“The decline in China’s coal imports in late 2020 could be hampered by the customs clearance process,” the Department of Industry, Science, Energy and Resources said in a September quarterly report.
Although the steel industry, which relies heavily on cheap commodities such as the Rio Tinto Group and the BHP Group, needs to curb that production, China is also the main buyer of iron ore, China’s most lucrative export to Australia. .
BHP Group, Australia’s largest exporter of coking coal, did not immediately respond to a request for comment. China Bauu Steel Group, the country’s largest mill, declined to comment. The ban on coal was first reported by shopkeepers like S&P Global Platts and Argus Media.
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