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China's coal imports in August hit an 8-month-high, but are still lower than the year-ago level

Customs data released on Monday showed that China's coal exports reached an eight-month peak in August. This was largely due to higher prices at home, but volumes were still below those seen a year ago.

According to the General Administration of Customs, the country imported 42.74 millions metric tons of coke last month. This was the highest since December but down around 7% compared to August 2024.

Toby Hassall is the lead analyst of LSEG's coal market. He said that "the rise in imports reflected a widened arbitrage as China’s domestic prices climbed following a reduction in coal production locally in July and a drawing down in Bohai Rim Port stocks."

China's imports of coal have fallen year-over-year, as buyers have turned to the abundant and cheap domestic supply. To support the price, however, the authorities have set production limits since July. This has caused domestic coal production to drop to its lowest level in more than a year.

According to an index published by the government, domestic coal prices rose to a six month high at the end August due to tightening supply.

Import arbitrage became more profitable due to the surge in domestic coal prices. Since September, prices have decreased as the weather has cooled.

In its half-yearly report, Shenhua Energy - the listed subsidiary of China's largest mining company - forecasts that imports will remain below the levels of last year through the second half.

Customs data revealed that coal imports for the first eight-month period were down by 12% on an annual basis, at 299.94 millions tons. (Reporting and editing by Rashmi aich and Sherry j. Phillips; Colleen howe)

(source: Reuters)