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EU: 40 Million Tons of Coal Will Need to Be Sourced from Elsewhere After Ban on Russian Coal

With the EU ready to ban Russian coal imports, it’s worth taking a look at what this means for the seaborne coal trade in general. In its latest weekly report, shipbroker Banchero Costa said that “following a disastrous 2020, with the world hit by lockdowns and recession pretty much everywhere, global seaborne coal trade managed to rebound to some extent in 2021. In the full 12 months of 2021, global seaborne coal exports increased by +4.4% y-o-y to 1149 mln tonnes, from 1101 mln tonnes in 2020, according to vessels tracking data from Refinitiv. This however was still well below the levels we had in pre-Covid times, being -9.9% down from the 1276 mln tonnes shipped during 2019. In the first quarter of 2022, however, global coal trade declined again”.

According to Banchero Costa, “in the January to March period of 2022, global coal loadings declined by -6.0% y-o-y to 256.3 mln tonnes, from 272.7 mln tonnes in the first quarter of last year. Most of the decline was in he month of January, which was particularly disappointing at just 77.3 mln t, down by -17.2% y-o-y from January 2021. The European Union is now the fifth largest seaborne importer of coal in the world, after China, India, Japan and South Korea.

Source: banchero costa &c s.p.a

In 2021, the EU accounted for 7.5% of global seaborne coal shipments. The EU’s seaborne coal imports in the 12 months of 2021 increased by +21.2% y-o-y to 81.1 mln tonnes. This was mostly a rebound from a massive -32.9% y-o-y decline in 2020 caused by Covid lockdowns. Previous years also saw a negative trend, with European coal imports declining by -18.3% y-o-y in 2019 and by -7.6% y-o-y in 2018, as European countries progressively abandon coal as a source of energy and embrace natural gas and renewables”.

The shipbroker said that “in the first 3 months of 2022, coal imports into the EU further increased by +23.6% y-o-y to 24.5 mln tonnes. Europe was the only major region aside from South Korea posting positive coal import trends this year. For comparison, in 1Q2022, China’s coal imports declined by -36.0% y-o-y, India’s were down -12.8% y-o-y, whist Japan saw a modest +1.6% y-o-y increase. The main coal import terminals in the European Union (27) are: Rotterdam in the Netherlands (22.2 mln tonnes discharged in 2021), Amsterdam Netherlands (6.6 mln tonnes), Hamburg Germany (5.1 mln tonnes), Dunkirk France (4.4), Gijon Spain (4.3), Ljmuiden Netherlands (3.3), Gdansk Poland (2.8), Vlissingen Netherlands (2.4), Fos France (2.3), Taranto Italy (2.2), Eemshaven Netherlands (1.8), Ghent Belgium (1.8), Civitavecchia Italy (1.7), Tarragona Spain (1.6), Rostock Germany (1.2), Wilhelmshaven Germany (1.2), Ploce Croatia (1.1), Koper Slovenia (1.0). In terms of sources of the shipments, Europe was and still now remains heavily dependant on Russia. In the whole of 2021, as much as 46% of the EU’s seaborne coal imports were sourced from Russia”.

Source: banchero costa &c s.p.a

According to Banchero Costa, “in 2021, imports from Russia increased by +22.4% y-o-y to 37.5 mln tonnes. The second most important supplier to Europe is Australia, accounting for 17% of Europe’s imports in 2021. In 2021, imports from Australia increased by +22.9% y-o-y to 13.5 mln tonnes. The third largest supplier to Europe are the USA, accounting for 15% of the EU’s seaborne imports during 2021. In 2021, imports from the USA increased +18.7% y-o-y to 12.5 mln t. In fourth place was Colombia, with a 10% share of Europe’s coal imports. In 2021, 7.8 mln tonnes were imported from Colombia to the EU, up +48.4% y-o-y. In the first 3 months of 2022, Russia was still accounting for 38% of Europe’s coal imports. In Jan-Mar 2022, the EU imported 9.3 mln tonnes of coal from Russia by sea, down -0.4% y-o-y. In the same 3 months, imports from the USA increased by +60.2% y-o-y to 4.4 mln tonnes, from Colombia by +50.4% y-o-y to 3.4 mln tonnes, whilst from Australia imports declined by -10.8% y-o-y to 3.5 mln tonnes. Do note that imports from Russia continued quite steadily also in March 2022, after the start of the war. In March 2022, the EU imported 3.1 mln tonnes of coal from Russia, down -13.8% y-o-y, still accounting for 32% of the EU’s total coal imports in March”, the shipbroker concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide

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