Chinese steel mills and power plants received verbal instructions during the National Day holiday week to stop buying Australian coal with immediate effect, according to reports published on 12 October. The order, which was never confirmed in a formal written notice, covered both coking coal used in steelmaking and thermal coal used for power generation. Australia normally supplies about 40% of China's imported coking coal, making it the hardest grade to replace, although imports account for only a small share of China's total coal consumption. The market reaction was swift: the price of Australian premium hard coking coal fell from about $132.82 per tonne on 9 October to $104.40 by 13 November, while buyers in India and Southeast Asia picked up diverted cargoes at discounted prices. Chinese mills turned instead to domestic coal and to supplies from Mongolia, Canada and the United States, pushing those prices higher. The move was widely linked to the worsening political relationship between Beijing and Canberra.
Source: Steel Market Update — https://www.steelmarketupdate.com/2020/10/15/cru-china-s-reported-ban-of-australian-coal-imports/
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