China eyes more coal imports from Mongolia as supply shortage bites

Name: Chinese cash funds African coal plants despite environmental concerns
Uploaded: 2021-09-08T20:30:10.000Z
Duration: 2 min 6 s
Description: Chinese cash funds African coal plants despite environmental concerns

At a meeting on Tuesday, China requested more coal from Mongolia to help offset an ongoing supply shortage

Mongolia has replaced Australia as China’s largest source of imported coking coal since the second half of last year

3-MIN READ3-MIN

Mongolia has replaced Australia to become China’s largest source of imported coking coal since the second half of last year. Photo: AP

Orange Wang

Published: 4:30am, 9 Sep 2021Updated: 11:49am, 9 Sep 2021

Beijing has stepped up efforts to source more coal from neighbouring Mongolia amid an ongoing supply shortage, raising more questions about how long a ban on Australian coal can last.

China is suffering from a spike in coal prices amid declining supplies, which has also prompted authorities to ban an influential local trading platform from updating coal prices and market news that could fuel speculation.

Rising coal prices are another worry for China, which is already dealing with high raw material costs that are hurting businesses.

In a virtual meeting with Mongolian deputy prime minister Amarsaikhan Sainbuyan on Tuesday, Chinese commerce minister Wang Wentao broached the topic of buying more mineral and agricultural products from Mongolia, a ministry statement said.

02:06

Chinese cash funds African coal plants despite environmental concerns

Since the ban on Australian coal last October – which formed part of a broader trade spat between the two countries – data shows China has stepped up purchases of coal from other exporting countries, including Mongolia, to meet domestic demand that has spiked due to bouts of extreme weather.

Mongolia has replaced Australia to become China’s largest source of imported coking coal since the second half of last year, but transport between the two countries has been frequently disrupted by Covid-19 outbreaks in the landlocked east Asian nation.

Local media reported on August 21 that Ganqimaodu customs in China’s Inner Mongolia autonomous region had suspended coal imports from Mongolia for two weeks due to pandemic prevention. The port carries about half of China’s coking coal shipments from Mongolia.