China-Australia relations: Chinese buyers snap up more coal as diplomatic relations thaw

China imported US$41.9 million worth of coking and thermal coal from Australia in February in a sign of warming ties between the two nations

Imports are still a shadow of the level they were before diplomatic ties plummeted in mid-2020, but there is ‘renewed interest’ among Chinese buyers

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An excavator is seen on a pile of coal at the Port of Newcastle, Australia. Chinese imports of Australian coal resumed in February. Photo: Bloomberg

Published: 4:00am, 21 Mar 2023Updated: 9:36am, 21 Mar 2023

China imported US$23.7 million worth of coking coal and US$18.2 million worth of thermal coal from Australia in February, official data showed, after Beijing lifted an unofficial ban on the product that was imposed in 2020.

The volume of Australian coking coal entering China reached 72,982 tonnes last month, while some 134,254 tonnes of thermal coal was snapped up by Chinese buyers, according to data released by the General Administration of Customs on Monday.

While the imports signal warming relations, the volume is far below the level it was before diplomatic ties took a turn for the worse in mid-2020. In February of that year, China imported 3.4 million tonnes of thermal coal and 3.9 million tonnes of coking coal.

Chinese imports of Australian coal resumed in February and no year-on-year comparison is available.

This year, however, Chinese buyers have stepped up inquiries about Australian coal with state-run companies showing “renewed interest” due to the quality, price and logistics advantages, according to Harry Huo, the chief editor at sxcoal.com.

The Shanxi-based coal information provider also said “a lot of vessels over two megatonnes” departed Australia in February and were set to arrive in China by March.

China’s state planner, the National Development and Reform Commission, held talks with four state-owned importers in January over a partial lifting of the verbal ban on Australian coal.