Australia: Thermal coal exports increase 5% m-o-m in May'24

Australian thermal coal exports saw a slight increase m-o-m to 16.36 million tonnes (mnt) in May 2024, as per BigMint's vessel line-up data. This represents a 4.7% rise compared to 15.63 mnt in April 2024.

The major reason for rise in exports were material availability hindrances at South Africa due to train derailment towards middle of the month.

The railway lines are yet to resume completely. Also, some material supply crisis was heard in Indonesia due to rainfall. Prices of Australian thermal coal (5500 NAR) fell by 8% m-o-m to $91.8/t, FoB in May 2024, up from $88.5/t in April.

Australian thermal coal exports to China rose by 10% m-o-m to 6.06 mnt in May 2024, accounting for almost 37% of total exports. The exports rose on back of production at some coal mines in northern Shanxi been affected by environmental checks, leading to tightening supply to local buyers and port-based traders.

Also, the consistent rainfall in South China had negatively led to domestic price rise, and hence making imports convenient. Utilities had decreased their intake of immediate cargoes and opted to purchase cargoes for further ahead months instead. Exports to Japan remained stable m-o-m, with shipments at 3.93 mnt in May 2024. Exports to Taiwan also increased, totalling 2.07 mnt in May 2024, up by 19% from April 2024. Exports to South Korea rose by 5% m-o-m to 1.32 mnt in May 2024, compared to 1.27 mnt in April 2024. Exports to India remain stable, standing at 0.48 mnt in May 2024.

Exports from Newcastle increased by 3% m-o-m to 11.58 mnt in May 2024 as against 11.26 mnt in April. Shipments from Gladstone dropped by 6%, Shipments stood at 1.59 mnt in May 2024 as against 1.69 mnt in April 2024. Supplies from Abbot Point surged by 28% m-o-m to 1.53 mnt in May 2024 as against 1.19 mnt in April 2024. However, exports from DBCT rose by 15% m-o-m to 1.24 mnt in May as against 1.08 mnt in April.

Australian thermal coal exports are expected to remain range-bound due to some hindrances in exports from major suppliers like South Africa and Indonesia. Coupled with, monsoon season in major Asian countries expected to start in June may impact the exports though they have already completed restocking needs.