Australian coal exports increase in June

Australian coal exports have increased in June ahead of the end of the 2021-22 fiscal year ending 30 June and as drier conditions allow mining firms to increase deliveries to ports in New South Wales (NSW) and Queensland.

June has been the driest month this year in both coal producing states, after above average rainfall from November to early May that filled water storage capacity and slowed coal mining because of saturated mines. The dry weather allowed coal mines to increase production ahead of the end of the fiscal year and to benefit from firmer prices for thermal and metallurgical coal.

The drier conditions have seen port throughput increase, with most ports on track to beat strong May coal exports in June, according to initial shipping data collated by Argus. May was the strongest month for exports in nine months in Queensland and since January in NSW. While all ports are likely to see firm throughputs, some have drivers beyond the weather that are pushing up exports.

Indian conglomerate Adani has increased shipments from its Carmichael thermal coal mine through the most northerly Queensland port of Abbot Point, where initial shipping data suggests that June exports will surpass the high of 2.94mn t set in May. The firm aims to ship 11mn-12mn t from the mine during its 2022-23 fiscal year ending 31 March, or around 1mn t/month.

Abbot Point shipped an average of 2.44mn t/month in 2021 before the first Carmichael cargo left in January 2022, implying it will increase shipments beyond 3.5mn t/month to include Carmichael, if all other shippers maintain throughput. Output from Carmichael was depressed during February-April, with Abbot Point shipments 10pc below the 2021 average in each of these months.

The multi-user ports of Dalrymple Bay and Gladstone each have additional supplies with several mine restarts in Queensland and the ramp-up of Anglo American's 6.5mn t/yr Moranbah and 5mn t/yr Grosvenor mines.

Shipping queues have eased to close to average levels, having spiked earlier in the month, indicating that the ports are operating well. There were 22 vessels outside Gladstone, 27 at the adjacent ports of Hay Point and Dalrymple Bay, three at Abbot Point and 27 at Newcastle on 28 June.

Thermal coal prices remain close to record highs and while metallurgical prices have eased they are still above historic averages. Both are high enough priced to stimulate Australian mining firms to push out as much coal as they can into the spot market.

Argus last assessed the high-grade 6,000 kcal/kg NAR thermal coal price at $403.90/t fob Newcastle on 24 June, down from a peak of $425.90/t on 20 May but up from $192.60/t on 7 January.

Argus last assessed the premium hard low-volatile coking coal price at $324/t fob Australia on 27 June, down from a peak of $663.80/t on 14 March but up from $183/t a year ago.

By Jo Clarke

Australian thermal coal prices ($/t)

Australian metallurgical coal prices ($/t)