Australia's thermal coal exports rebounded in October from a weak September, driven by increased shipments to China, strong buying from India and deliveries to South Korea.

Australia exported 17.24mn t of thermal coal in October, up from a revised 14.89mn t in September, but down from 18.75mn t in October 2019, according to the Australian Bureau of Statistics (ABS).

November exports are likely to have been much lower, with the main New South Wales thermal coal port of Newcastle shipping 11.9mn t, down from 14.9mn t in October. Australia exported 28.2mn t of thermal and coking coal last month, according to Argus analysis of shipping data, with around 14mn t likely to have been thermal coal, based on the historical split between the two, down from 14.6mn t in November 2019.

December is usually a stronger month for thermal coal shipments and there are long queues of vessels waiting to load at Newcastle. But several mining firms are considering closing over Christmas as Chinese bans on imports of Australian coal weigh on demand.

Australian thermal coal exports to China increased by 30pc in October from September's nine-year low, but were still 60pc, or 2.5mn t, down on the year. January-October exports to China of 34.3mn t were 19pc down on the year — the sharpest fall of any major Asian customer, despite China recovering more swiftly from Covid-19 than other countries in the region.

Tensions between Beijing and Canberra continue to rise, with China excluding Australian coal from the temporary lifting of restrictions on imports through ports in southern Guangdong province.

Shipments to India in October fell from September's six-year high, but were still 640,000t up on the year. Strong exports in September-October pushed January-October sales to India up by 59pc on the year.

Exports to northeast Asian markets excluding China grew by 230,000t on the year, driven by Japan, but lower shipments to Cambodia, Malaysia and Thailand curbed total exports to southeast Asia.

Other notable destinations for Australian coal included Chile, with January-October loadings trebling on the year to 1.6mn t. And Pakistan received 570,000t, having previously imported Australian coal in 2017.

The Argus Newcastle 6,000 kcal/kg price averaged $54.20/t fob Newcastle in October, up from $48.54/t in September, but down from $64.32/t in October 2019. It was assessed at $65.11/t on 27 November.

The Argus Newcastle 5,500 kcal/kg price averaged $39.52/t in October, up from $37.54/t in September, but down from $49.94/t in October 2019. It was assessed at $42.04/t on 27 November.

The heat-adjusted price differential between the Argus Newcastle 6,000 kcal/kg and 5,500 kcal/kg prices on a 6,000 kcal/kg basis widened to $19.25/t on 27 November from an average of $11.09/t in October and $7.59/t in September.

Australia's average thermal coal export price was $54.11/t in October, up from $53.08/t in September, but down from $63.64/t in October 2019, according to the ABS.

October prices were based on ABS' exchange rate of $0.7498 to the Australian dollar.

Thermal coal export revenues totalled A$1.24bn in October, up from A$1.08bn in September, but down from A$1.75bn in October 2019.

This article is reproduced at www.argusmedia.com