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Surprise boost in coal sales to China

Surprise boost in coal sales to China  article image

A surge in coal exports to China could stave off what looked to be an industry-wide slump. Coal producers have attributed the jump to heavy Chinese buying, which has offset declines in markets such as Japan. Chief executive of Felix Resources Brian Flannery, said his company has previously sent only one shipment to China in four years, but was likely to sell 10 shipments this year: "We've had a cutback in the Japanese off-take, which has probably been picked up by our Chinese off-take." While China has its own coal mines, demand may have spiked after the Chinese government closed some of them due to safety concerns. The demand is mostly for coking coal, used in steel production, which may mean the Chinese stimulus package, and a subsequent increase in production, has had positive effects on the Australian industry.

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