Australia plays down Chinese coal restrictions: Update

adds comments from buyer and traders in paragraph 5

The Australian government has played down any political link to the move by customs at north China's Dalian port to tighten the quota on Australian coal imports this year. The restrictions follow a period of cooling political relations between the two countries.

Dalian set a quota of 12mn t for February-December 2019 for all types of imported coal, market participants said yesterday.

"The Australia-China trading relationship is exceptionally strong," Australian treasurer Josh Frydenberg said today. The treasurer said not to jump to any conclusions when asked if the move by Dalian customs was in relation to Canberra joining a number of countries in banning the Chinese telecommunications firm Huawei from participating in the construction and operation of 5G mobile phone networks.

"We have a very strong relationship with China, and it's based on mutual respect and mutual interest and the relationship both at a people to people links, as well as a trade and economic side, is very important to both countries," said Frydenberg.

An official at a northeast China steel mill that gets imported coking coal deliveries from Bayuquan port has confirmed that customs declaration for Australian coal are continuing as usual, albeit with longer waiting times. Traders in the largest coal port of Liaoning have also said that Australian coal has not been banned.

Australia exported around 30.8mn t of hard coking coal to China in 2018 from 29.3mn t in 2017. A further 8.3mn t of semi-soft coking coal was shipped, down from 11.7mn t in 2017. Australia exported almost 50mn t of thermal coal to China last year from around 42mn t in 2017.

Australia's ambassador in China Jan Adams has been asked to investigate the issue at Dalian port, said Australian trade minister Simon Birmingham."We continue to engage closely with industry on matters of market access," Birmingham said.