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Australia to export more coking coal in 2019

  • Market: Coking coal
  • 30/09/19

The Australian government's commodity forecaster the Office of the Chief Economist (OCE) has revised up its Australian metallurgical coal export expectation for 2019 by 4mn t, as Queensland ports increase throughput despite maintenance issues.

The OCE projects Australian coking coal exports to rise to reach 185mn t in 2019, compared with its June forecast of 181mn t. It maintained its forecast for 2020 and 2021 at 195mn t and 199mn t, respectively, in its September resources and energy quarterly (REQ) released today.

The OCE increased its expectation for world trade in coking coal to 344mn t in 2019 and 350mn t in 2020 from 334mn t and 338mn t, respectively, in its previous forecast, despite maintaining or slightly cutting its expectations for exports from the US, Russia, Canada, Mozambique and Mongolia.

The OCE has revised down its 2019 average spot price forecasts to $186/t from $198/t in its June REQ because prices declined more rapidly than expected, offsetting the impact of a downward revision of the Australian dollar against the US dollar. The OCE expects coking coal prices to remain under pressure because of Chinese import restrictions and a well-supplied seaborne market, as Australia and Russia increase exports.

Queensland coal shipments were below average for the first few months of this year because of a series of maintenance issues and bad weather.

These issues have largely been resolved with shipments largely above average since June, despite ongoing maintenance at the BHP Mitsubishi Alliance-operated port of Hay Point.

Around 13mn t of new capacity next year will come on line from three Australian coking coal projects — the restart of Japanese firm Sojitz's 6mn t/yr Gregory Crinum mine, the start of Australian firm Fitzroy Resources' 3mn t/yr Ironbark No.1 mine and the start of the 4mn t/yr stage one of Australian firm Pembroke Resources' Olive Downs South mine.

Peabody also hopes to produce 2mn short tonnes in 2020 from reopening its North Goonyella mine, which has been closed since September 2018 because high gas levels and a fire.

All this new capacity will put further pressure on prices in 2020, assuming all the projects begin production on time.

Beyond these immediate projects, the OCE notes that the long-term project pipeline is limited, with a growing reluctance to commit to new projects amid community opposition and a problematic lending environment for coal.


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CSX expects continued coal challenges in 2025


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22/01/25

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Viewpoint: US utilities worry over railcar supply


02/01/25
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02/01/25

Viewpoint: US utilities worry over railcar supply

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