China restores coal tariffs in threat to Russian exporters
China has restored import levies on coal from the beginning of the year, a move that could threaten Russian exporters dependent on the world’s largest market for the fuel.
The tariffs were removed in May 2022 to guard against supply risks after Moscow’s invasion of Ukraine roiled global energy markets. That helped pave the way for record imports last year, which included an increased portion of Russian coal shunned by other buyers. Now, policy has shifted to protecting China’s mining companies from the consequences of a glut after domestic output also rose to an all-time high.
Russia has become the no. 2 shipper of coal to China and the long-term aim of the two countries is for annual supply to reach 100-million tons, a figure that’s likely to be hit in 2023 once December’s imports are tallied. To maintain those volumes, Russian prices will have to fall.
“No other countries can take in such large supplies,” Su Huipeng, an analyst with the China Coal Transport and Distribution Association, told a briefing last week. “It has to be exporters cutting prices and absorbing the additional tax cost.”
Russia’s monthly coal sales to China have declined since peaking at more than 10-million tons in June as its shipments have become less competitive against other origins, a dynamic that’ll only worsen as taxes are reimposed.
Meanwhile, rivals such as Australia and top supplier Indonesia are shielded from the duties because of free trade pacts struck with Beijing. Moscow has also imposed a tax on its own overseas sales to help pay for its war.
China’s duties for most-favored nations, including Russia, Mongolia, South Africa and the US, have returned to a rate of 6% on coal for power and heating and 3% on coking coal used by steel mills. China has an abundance of thermal coal but is generally short of the steelmaking variety, which should help limit the impact of the levies on those imports.
Coal from other countries that don’t enjoy preferential status will be taxed at 20%.
Comments
The
content
you are trying to access is only available to subscribers.
If you are already a subscriber, you can Login Here.
If you are not a subscriber, you can subscribe now, by selecting one of the below options.
For more information or assistance, please contact us at subscriptions@creamermedia.co.za.
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation