BEIJING (Realist English). Russia’s coal shipments to China have been rising even though overall shipments to China have declined, CNBC reports, citing new data from S&P Global Market Intelligence.
Russian seaborne coal deliveries to China surged 55% to 6.2 million tonnes in the first 28 days of June compared to the same period last year, S&P’s Commodities at Sea database showed. In May, Russian seaborne supply to China also rose by 20% year-on-year to 5.5 million tonnes.
Domestic production in China has also been increasing. The latest data from the National Bureau of Statistics of China showed that between January and May, raw coal production rose 10.4% year-on-year to 1.81 billion tonnes, while imports dropped to around 96 million tonnes — down 13.6% compared to a year ago.
“Despite lower demand and higher domestic coal production, China has been buying significantly higher Russian coal since May 2022,” S&P Global Market Intelligence associate director Pranay Shukla said told CNBC. “This is because Russia has been offering very steep discounts on prevailing international coal prices.”
China, the world’s largest coal buyer, has promised in 2020 to become carbon neutral by 2060. But after millions of households and businesses faced severe electricity shortages at the end of 2021, Beijing increased its coal consumption.
Coal imports in 2021 increased by 64%, and domestic production reached a record 4.13 billion tons. It is expected that by the end of this year, these figures will be even higher, as Chinese leader Xi Jinping gives priority to investments in infrastructure to revive the economy.
In April, the G7 countries promised to abandon Russian energy carriers, as part of the policy of tightening sanctions against Russia.
The European Union, along with Japan, announced a ban on Russian coal in its fifth package of sanctions in April, but the ban was postponed to August.
In 2021, up to 60% of China’s electricity was produced from thermal coal, and more than 90% of Chinese steel was produced in blast furnaces burning coking coal. According to the National Bureau of Statistics of the People’s Republic of China, as of last year, coal accounted for 56% of the total energy consumption in the country.
Russia ranks sixth in the world in terms of coal exports and is one of its key suppliers to both China and the EU countries.