China's Coronavirus Outbreak May Result in Short-term Coal Supply Squeeze: Noble Research

China which is currently dealing with Wuhan virus outbreak is likely to see disruptions in its coal supplies till May'20, said Echeverri Rodrigo - Head of Hard Commodities Research, said in Colatrans conference currently being held in Goa.

According to him if we look at the various parameters such as country's air quality index which is quite good, transportation rate and real estate transactions which are to the lowest, the Chinese are not yet back to work amid fears of Wuhan virus outbreak which is going to adversely affect the country's coal supplies till first half of the year.

China is likely to face a demand loss of 180 MnT and a supply loss of 200 MnT this year due to disruption caused by Coronavirus, he added.

Apart from domestic production, China is also dependent upon imports from Indonesia to fulfill its thermal coal requirements and the looking at the Indonesian vessel queues near the Chinese coast, it can be inferred that Chinese are swiftly buying coal and stocking it up so that when market returns back to normalcy they don't have to face the shortage of the same.

Mr. Echeverri added that the good news amid the negative sentiments in China is that the country will inject money into the economy as a stimulus package to boost demand in the country in the coming months ahead.

The Indonesian market is going to see an addition of 20-30 MnT of coal production whereas its domestic demand will remain the same this year which means that the country 's coal exports are set to rise in 2020, Mr.Echeverri said in its conclusive statements.