China has imposed port restrictions on coking coal imports at several ports in Northeast China including Bayuquan, Dandong and Dalian effective Tuesday afternoon, market sources with knowledge of the matter told S&P Global Platts Wednesday.
Three Chinese steelmakers confirmed that they had received verbal notice from Northeast China ports' agents on the port restrictions imposed.
A meeting will be held Wednesday and more details are expected later in the day, the sources said.
When contacted, a Dalian port authority official did not confirm this matter.
According to market sources, the restrictions were imposed as the overall volume of coal imported in January 2019 by Northeast China was greater than expected.
This restriction comes on the back of the import restrictions implemented across China on November 14, 2018, which meant that cargoes that had arrived in China in November and December 2018 could only clear customs in January, resulting in a significant increase in January's quota.
According to customs data, China imported 8.01 million mt of coking coal in November and December 2018. This compares with 11.39 million mt imported over the same period in 2017, reflecting a 42% year-on-year drop. In 2018, China imported 27.74 million mt of coking coal from Australia, which was a significant 43.19% share of its total coking coal import volume of 64.23 million mt.
China is also Australia's largest market for its resources and energy exports at A$87 billion ($62.6 billion) for Australia's 2017-2018 financial year, according to Australia's Department of Industry, Innovation and Science quarterly report released on December 11, 2018.
On Tuesday, Platts assessed Premium Low Vol coal up $1.25/mt day on day to $201.75/mt FOB Australia, while the CFR China price was up $5.50/mt day on day at $205.25/mt CFR China.
