China's coal imports from Mongolia continue to rise, adding pressure to price

sxcoal.com Price,  Ports,  Thermal Coal 2020-05-26 16:05:22

On May 23, Mongolia exported a total 955 trucks of coal to China through two major hubs Gashunnsukhait (Ganqimaodu) and Shivee Khuren (Ceke), Mongolian media GoGo Mongolia reported.


The figure has increased significantly, compared with only 700 trucks disclosed by Mongolia's Minister of Finance Ch.Khurelbaatar on May 8.


Data from sxcoal.com showed coal imports via Ganqimaodu averaged 428 trucks a day in the week of May 18-22, up 8.63% from a week ago. On May 23, the number rose to 628, despite down to 502 on May 25.


Wu Qian, an analyst of sxcoal.com, said with the imports growing, the volume of Mongolia coal sold to China's key consumption areas like Hebei's Tangshan is slowly recovering, but it also brought down the prices.


"With more saleable resources, trading prices of Mongolian #5 ROM (0.9% sulfur, CSR 64%) now drops to 820-830 yuan/t, and prices of washed coal (0.7% sulfur, CSR 67%) down to 980-1,020 yuan/t," she said.


According to sxcoal's assessment on May 25, the ROM price was 830 yuan/t, down 30 yuan/t from a week ago, and the washed price stood at 1,010 yuan/t, a 20 yuan/t fall on the week, both on ex-stocks with 13% VAT.


One Mongolian source said coal delivery to Ganqimaodu might keep strong in the near term, as Chinese buyers have already bought a number of cargoes and piled them up at a transfer storage place Tsagaankhad between Tavan Tolgoi and Ganqimaodu.


It's learned that Mongolia planned to export 42 million tonnes of coal in 2020, in order to achieve a tax profit of 1.4 trillion MNT, or circa $500 million.


However, due to the lockdown measures to prevent the spread of Covid-19, its coal exports took a big hit in the first quarter.


Since February, coal exports from Mongolia to China have been temporarily shut down, leading to the all-time low in March.


In April, Mongolia's coal exports rallied 191.76% from March to 997,800 tonnes, but it was still 72.68% lower than a year ago.


Preliminary data of Mongolian customs showed as of May 10, Mongolia's coal exports totaled 4.6 million tonnes, a fall of 63% year on year; the value was $374.5 million, down 64.3%.


Data also showed in May 1-10, Mongolia's coal exports totaled 482,000 tonnes – from which the May's coal exports can be calculated at 1.45 million tonnes this month.


(Writing by Alex Guo  Editing by Tammy Yang)
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