China coal dilemma

In 2021, China took the drastic step of cutting off coal imports from Australia. China’s alternate supplier for thermal coal became Indonesia.

All good, until something else happens in Indonesia–
Indonesia is a major supplier of the world’s thermal coal.
But laws require mine operators to prioritise the state-owned domestic power generator at below-market prices of around $US70 per tonne, well below the Newcastle coal futures for January which soared to a 10-week high of $174.

So Indonesia is suspending coal exports for the month of January

https://www.hellenicshippingnews.com/global-thermal-coal-sup…

Awrighty China, the ball appears to be back in your court. You have other alternate coal sources? If not, y’all need to swallow some humble pie and have talks with Australia.

Just as a data-point, throw this link (2020 Top coal exporting countries)
https://www.worldstopexports.com/coal-exports-country/

13 Likes

Awrighty China, the ball appears to be back in your court. You have other alternate coal sources?

One option is to increase domestic production of the black stuff.

from October 2021:
https://www.cnn.com/2021/10/20/business/china-coal-productio…

(CNN Business) The Chinese government has ordered the country’s coal mines to “produce as much coal as possible” as it tries to increase production as winter approaches, and ease an ongoing energy crunch.
The announcement from China’s National Development and Reform Commission comes after weeks of power shortages across many provinces, forcing the government to ration electricity during peak hours and some factories to suspend production. The problem has weighed on economic growth as industrial output drops.


from Power Engineering mag…
https://www.power-eng.com/coal/china-reopening-coal-mines-as…

China’s NDRC authorized 15 coal mines to restart production across the Shanxi and Xinjiang regions in the north, amounting to about 44 million tons of coal delivery. Other mines are reopening elsewhere.


Whether or not these production mandates will have the effect of satisfying demand is anyone’s guess.

  • Pete
3 Likes

Awrighty China, the ball appears to be back in your court. You have other alternate coal sources? If not, y’all need to swallow some humble pie and have talks with Australia.

==============================================================================

China’s coal supply will see a limited impact following the one-month export ban by Indonesia - China’s largest import source of thermal coal, experts said, citing the small volume of imports compared with domestic output and the country’s already expanded and stable coal production now.

The Indonesian government on Saturday banned coal exports in January, citing worries that insufficient supply at domestic power plants could result in widespread blackouts.

Its impact on China’s coal supply, which is heavily reliant on domestic output since imports only account for about 10 percent, will be limited and controllable …

China has been ramping up coal imports from Russia in recent months, replacing Australia, once China’s largest source of imported coal.

https://www.globaltimes.cn/page/202201/1243997.shtml

Jaak

1 Like

Awrighty China, the ball appears to be back in your court. You have other alternate coal sources?

One option is to increase domestic production of the black stuff.

And those orders to the Chinese miners were before Indonesia went all-domestic. Could US mines ramp up production?

DB2

@DB2 Could US mines ramp up production?

Are you asking whether the US is prepared or whether US has export capacity?

Could US mines ramp up production?

Are you asking whether the US is prepared or whether US has export capacity?

Export capacity.

DB2

I do think the US has the ability to expand coal production and thus increase exports.

However, given the current US-China relations, I’m not sure the US would be as open to doing so for China. Unless possibly, there were concessions on other items.

3 Likes

And those orders to the Chinese miners were before Indonesia went all-domestic. Could US mines ramp up production?

DB2

=======================================================

There is no way to ship coal to China from the US except via the Panama Canal. Therefore it is much cheaper to get Russian coal to China. Furthermore, China has enough coal to supply its own needs.

Jaak

Furthermore, China has enough coal to supply its own needs.

Why are they importing coal?

DB2

2 Likes

Why are they importing coal?

DB2

====================================

They are only importing 10% of their coal consumption. Indonesian coal was cheap and gave Australia a black eye.

Jaak

There is no way to ship coal to China from the US except via the Panama Canal.

Curious, since I know of a running battle at the Port of Richmond, CA about the coal they ship from there.

1 Like

There is no way to ship coal to China from the US except via the Panama Canal.

Curious, since I know of a running battle at the Port of Richmond, CA about the coal they ship from there.

https://www.gem.wiki/Coal_exports_from_ports_on_the_west_coa…
As of September 2021, the only ports handling coal in the Pacific Northwest are the Port of Stockton (2 million tonnes per annum (mtpa)) and the Levin-Richmond Terminal (1 million mtpa), both along the Sacramento River in California, and the Ridley Terminal (18 mtpa) and Westshore Terminals (33 mtpa) in British Columbia, Canada.

DB2

2 Likes

As of September 2021, the only ports handling coal in the Pacific Northwest are the Port of Stockton (2 million tonnes per annum (mtpa)) and the Levin-Richmond Terminal (1 million mtpa), both along the Sacramento River in California …

=============================================================

These are tiny exports. China consumes about 4 billion tons coal per annum. These ports do not export to China and they will be eliminated as soon as California gets around to it. There will not be any new ports built in California, Oregon and Washington.

Jaak

1 Like

Exporting more coal is not a reasonable goal for the US.

These are tiny exports. China consumes about 4 billion tons coal per annum. These ports do not export to China and they will be eliminated as soon as California gets around to it. There will not be any new ports built in California, Oregon and Washington.

Jaak

@ Jaak - you jumped in with the absurd claim that there was no way for coal to be shipped to China except via the Panama Canal. At least two people pointed out the fallacy of this statement. There is actually two other ways, though they might not be cost effective
a. US East Coast port - Atlantic Ocean - Mediterranean Ocean - Indian Ocean - China
b. US East Coat port - Atlantic Ocean (south via Cape) - Indian Ocean - China

Fortunately, YOU do not get to decide how states and a country operate.

HohumYNWA

3 Likes

Jaak - you jumped in with the absurd claim that there was no way for coal to be shipped to China except via the Panama Canal. At least two people pointed out the fallacy of this statement. There is actually two other ways, though they might not be cost effective

============================================================

As I said before those tiny shipments from California are not going to China and do not amount to any absurd claim by me.

And it is absurd to suggest shipping coal from East Coast ports to China because of economics.

So I have no respect for your nit picking comments.

Jaak

1 Like

Fortunately, YOU do not get to decide how states and a country operate.

Hohum,

Respectfully, we do get to decide.

The balance of sequestered carbon needs to be the determining factor.

A simplistic profit motive is not good enough.

Jaak, you made a statement that was incorrect. It’s okay to admit you were wrong.

Moving on, looking at some numbers for US coal exports
www.eia.gov/coal/production/quarterly/pdf/t7p01p1.pdf
Europe makes up 25% of our exports, while Asia is 50%. India makes up a full 19% while China takes 15%.

DB2

4 Likes

Thank you for recommending this post to our Best of feature.

Jaak, you made a statement that was incorrect. It’s okay to admit you were wrong.

Moving on, looking at some numbers for US coal exports
www.eia.gov/coal/production/quarterly/pdf/t7p01p1.pdf
Europe makes up 25% of our exports, while Asia is 50%. India makes up a full 19% while China takes 15%.

DB2

In 2018, Germany imported 46.6 million tonnes, or 94 percent of the hard coal it consumed. Its leading coal suppliers were Russia (40.8%), the United States (20.9%) and Colombia (8.1%). Hard coal covered 9 percent of Germany's primary energy use in 2019.Jun 19, 2020

There is actually two other ways, though they might not be cost effective
a. US East Coast port - Atlantic Ocean - Mediterranean Ocean - Indian Ocean - China
b. US East Coast port - Atlantic Ocean (south via Cape) - Indian Ocean - China

c. US East Coast port - Atlantic Ocean (south) - Pacific Ocean - China.

(Although that one is almost certainly not cost-effective.)

1 Like