China’s Coal Imports at Record as Temperatures Plunge

China, the world’s biggest coal user, boosted imports of the fuel to a record last month, spurred by temperatures at a 35-year low and stockpiling, according to customs data. 

Imports in December rose 6 percent from a year earlier to 17.34 million metric tons, the General Administration of Customs said in an e-mailed report today. Purchases gained 31 percent to a record 165 million tons in 2010, according to the data. 

“Imports jumped as demand rose in the winter,” Liu Zhaoliang, a coal analyst at Qilu Securities Ltd., said by mobile phone from Shanghai. “Power companies are also ramping up imports to build stockpiles before the Chinese new year.” The Lunar New Year holiday in China starts on Feb. 2. 

Snowstorms hit central and southern China last month, increasing demand for coal used to fuel power stations. Flights were cancelled and residents advised to stay inside as heavy snow fell in Shanghai this week, with more snow predicted. 

The country paid $108 a ton for the fuel in December, and an average of $103 a ton for the year, according to the customs data. The agency didn’t break down the data by type of coal. 

Prices of power-station coal with an energy value of 6,000 kilocalories per kilogram may rise to an average 860 yuan a ton this year from 780 yuan in 2010 at China’s Qinhuangdao port, Ghee Peh, the Hong Kong-based head of Asian mining research at UBS Securities Asia Ltd., said on Jan. 18. 

Indonesia was the nation’s biggest supplier in December and accounted for 33 percent of imports last year, according to the customs data. China boosted purchases from the world’s biggest supplier of thermal coal by 81 percent in 2010 from a year earlier, according to the report. Imports from Australia, the second-biggest supplier, fell 16 percent for the full year.

Australian coking and thermal coal cost $147 a ton on a delivered basis in 2010, according to the customs data. Indonesian thermal coal cost $79 a ton on a delivered basis. 

China may increase coal purchases to 210 million tons this year, Helen Lau, a Hong Kong-based analyst at UOB Kay Hian Ltd., said on Jan. 11. Source: Bloomberg