Adds details of coal producers' requests for DBCT capacity allocation changes in paragraphs 10-12. A previous version of this story incorrectly said Aurizon was planning changes to its rail capacity allocation system. No such changes are planned.
Planned maintenance at the BHP Mitsubishi-operated Hay Point coking coal terminal in Australia's Queensland state in October-December is threatening to further squeeze spot availability until the end of this year.
Berth #2 at Hay Point will be down for eight weeks from 9 October to 12 December, reducing throughput capacity at the port by about 30pc. The Hay Point coal terminal has three berths.
This could force BHP-Mitsubishi Alliance, Australia's largest coking coal producer and a major supplier to the seaborne spot market, to reroute supply to the Abbot Point coal terminal that is located further from its mines. This will add to costs and increase vessel congestion at Queensland's coal export terminals.
Berth #2 has a loading capacity of about 6,000 t/hour, compared to the total Hay Point capacity of about 20,000 t/h or 55mn t/yr for all three berths.
"The maintenance at Hay Point was just announced to the market, so we are not sure if this was scheduled maintenance or some sort of emergency," a Japanese trader said. "If this means contract volumes will be prioritised over spot volumes, then the market could be very tight for supply in November and December."
Queensland export terminals have been hit by vessel congestion for months, particularly at the Dalrymple Bay Coal Terminal (DBCT). The ship queue at DBCT was at 39 vessels today, up from 18-20 ships normally, with estimated waiting times of about three weeks. The queue at Hay Point was about nine vessels earlier this week, while the Abbot Point queue was four ships.
DBCT vessel queues could increase further as the port is scheduled to have maintenance at one of its shiploaders in November. The queue rose above 40 vessels after maintenance on another of the DBCT shiploaders that started in early July was extended by a week into mid-August.
"With maintenance going on concurrently at both DBCT and Hay Point in the last three months of the year, we expect more congestion at the ports which might result in delays for customers," another Japanese trader said.
Coal logistics networks in Queensland have been strained by record production at many mines in the state, as well as a controversial maintenance plan imposed by rail operator Aurizon that has disrupted some coal transport corridors. Rail maintenance has contributed to delayed cargo deliveries at Hay Point and DBCT, forcing vessels to wait for their arrival and adding to the congestion.
Producers are asking DBCT to allocate capacity at the port monthly rather than annually beginning in October to reduce the bottlenecks that contribute to long vessel queues. Producers that export through DBCT currently negotiate an annual volume allocation, despite changes in their monthly requirements.
But there is no indication that DBCT will change this capacity allocation system, regardless of how long port queues grow or how coking coal prices are affected.
There are no planned changes to how Aurizon allocates rail capacity, the rail operator said.
Coal shipments at Hay Point slipped to 3.64mn t in August from 4.26mn t in July, hitting the lowest level since October 2017 when the port also underwent maintenance.
