China will continue to implement zero-import tariffs for coal imports until the end of this year, according to a government document issued late last week.
The State Council's Tariff Commission announced on March 25 it will extend a zero import tariff rate on coal from April 1, 2023 until December 31, 2023, in order to ensure the reliability of coal supply.
This scraped the previous plan that a 3-6% tariff rate for different coal products would be reinstated starting next month.
On April 28, 2022, the government cut the coal import rates to zero from May 1, 2022 until March 31, 2023 in a bid to boost coal imports and alleviate end users' cost burdens amid soaring domestic and global prices.
Among all major coal suppliers, Russia, Mongolia, the U.S. and Canada will benefit from the zero-import tariff expansion as Australia and Indonesia have already enjoyed zero coal import tariff due to separate FTAs.
The policy will help push down the cost of imported coal. According to MinSheng Securities, it would increase more than 70 yuan/t for the cost of coking coal imports should a 3% tariff rate is imposed.
(Writing by Alex Guo Editing by Harry Huo)
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