Mongolian met coal supply to China via Ganqimaodu slips on week due to winter

Mongolian metallurgical coal shipments to China through the Ganqimaodu land port declined in the week to Nov. 12 amid winter weighing on coal deliveries, but overall year-to-date shipments remained sharply higher on the year, analysts and sources said Nov. 23.

Ganqimaodu, the largest land border port in Inner Mongolia, has allowed the transportation of Mongolian coal to China in recent years.

In the week to Nov. 12, daily coal haulage via the Ganqimaodu port reached 951 trucks, down 9.7% on the week, China-based consultancy Haitong International Securities said in a latest note.
But despite this, the number of trucks carrying coal through Ganqimaodu during the January-Nov. 12 period reached 228,600, more than double year on year, Haitong’s data showed.

Back in 2019, the COVID-19 pandemic lowered coal truck hauls from Mongolia through the Ganqimaodu port. But since then, Mongolia has emerged as the largest met coal supplier to China, overtaking China’s traditionally large supplier Australia.

In the near term, met coal shipments from Mongolia to China are expected to decline due to the winter season, as lower temperatures have been impacting loading and unloading, sources said.
The number of Mongolian trucks carrying coal to China may not breach the 1,000 mark in the near term, analysts at Haitong said.
Rising inspections

Met coal supply in China is expected to tighten in the near term, led by lower supply and rising safety inspections at key coal mines, which could eventually push up prices of related coal types, China-based analysts said.

Platts-assessed low-volatile hard coking coal ex-washing plant in Shanxi reached Yuan 2,150/mt ($300.62/mt) Nov. 22, rising 11% since the month started, S&P Global Commodity Insights data showed.
A major fire incident at the Yongju coal mine in Shanxi’s Lvliang city in mid-November led to safety inspections at various mines in the city, causing production halts, analysts at consultancy Everbright Futures said. This development shut down an estimated 21.9 million mt of coal output capacity in the city, the analysts said.

Shanxi is a major coal hub in China.

China’s met coal supply in November is seen falling to 46.96 million mt, down about 5% from the previous month, Everbright’s data showed.

Met coal inventories
In the week to Nov. 17, met coal stocks at China’s steel sector reached 7.72 million mt, down 290,000 mt on the year, data from consultancy East Asia Futures showed.
In the same week, the coking sector’s met coal stocks were reported at 9.89 million mt, up 500,000 mt on the year, the data showed.

Both steel and coking sectors are key consumers of met coal in China.

Meanwhile, met coal stocks at key Chinese ports were 2.07 million mt in the week to Nov. 17, up 1.05 million mt on the year.
Source: Platts