US coal exports climbed to a five-year high in April on trade with relatively new customers.
Shipments rose to just under 11.1mn short tons (10.1mn metric tonnes) from 7.24mn st a year earlier, according to US Census Bureau data released today. The last time exports were higher was in March 2013, when they totaled 13.6mn st.
The 18th straight month in year-over-year gains puts US exporters on track for the strongest year since 2013. Recent gains in seaborne thermal coal prices and still-elevated metallurgical markets should support this trend, but will have to offset effects of counter-measures countries are considering in response to increased US steel tariffs.
India, which has emerged as the largest destination for US thermal coal, is among countries that have said they plan on imposing import duties on US coal in the wake of the new US tariffs. So is Turkey, which US high-sulfur coal producers were hoping would become a growing source of demand if it raised the sulfur cap on imports.
Meanwhile, China is said to be contemplating increasing US coal imports as it engages in trade discussions with the US.
The US shipped 344,932st of coal to China in April, down from 377,539st a year earlier. But year-to-date shipments were up slightly, to 1.36mn st from 1.11mn st in the first four months of 2017. Most of that has been coking coal.
US exports to India jumped to 1.54mn st in April from 1.01mn st in the same month last year and were dominated by thermal coal, which increased to 905,419st from 644,811st. The US shipped just under 6.7mn st of coal to India since the start of the year, compared with 2.89mn st in January-April 2017. More than half of that — 3.9mn st — has been steam coal.
More than two-thirds of the US thermal coal shipments to India in the first four months of this year — 2.73mn st — have left from Baltimore, Maryland. That underscores market participants’ comments about certain Indian buyers’ preference for high-sulfur Northern Appalachia coal. Only 1.08mn st has come from the New Orleans, the primary export point for Illinois basin coal.
The 6,900 kcal/kg Northern Appalachia coal has been heard to be pricing in to India in the $105/t range, still holding a cost advantage to other fuels. Illinois basin coal has a lower calorific value of around 6,000 kcal/kg and would land in India for only slightly less than that based on recent assessments.
Total exports to Asia rose to 4.24mn st in April from a little under 3.7mn st. While thermal exports climbed to 2.22mn st from 1.53mn st, metallurgical shipments dipped to 2.02mn st from 2.06mn st. On a year-to-date basis, shipments of both types of coal were higher.
Exports to Europe rose for the first time since November, to 3.78mn st in April from 2.04mn st a year earlier. US thermal coal exports to the continent nearly tripled to 1.44mn st and metallurgical coal increased to 2.34mn st from 1.54mn st.
Gains to Europe were broad-based. Exports to the Netherlands increased to 1.18mn st from 762,916st in April 2017, while shipments to the Ukraine jumped to 551,214st from 143,298st. Volumes to Germany, Poland, the UK and Spain also rose.
US imports inched up, to 494,012st from 492,864st in April 2017. More than 90pc of the imports were steam coal.
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- On June 6, 2018