Queensland coal ports return to normal operations

Australia's Queensland coal ports are returning to normal following Cyclone Iris, but forecast weaker April shipments after a rebound in exports from the four largest coal ports in March.

Dalrymple Bay Coal Terminal (DBCT) reopened on 7 April and has been loading vessels at a slower than average rate because of draft restrictions, which are expected to be lifted today. Dalrymple Bay was closed on 3 April because of the proximity of Cyclone Iris, with the vessel queue blowing out to 30 ships from normal levels of around 18-20. Concerns are mounting that congestion could grow at the port, which ended up with a vessel queue of 47 in December because of maintenance and overallocation by mining firms in October and November. New maintenance that was due to start on 9 April has been pushed back to begin on 16 April because of Cyclone Iris.

The maintenance originally involved berths No.3 and No.4 closing during 9 April-4 May, while berth No.1 was due to be closed for a 24-hour period before the other shutdowns. This will take out approximately half of Dalrymple Bay's loading capacity. Its operators now hope to clear some of the backlog of ships that accumulated during Cyclone Iris before starting the maintenance next week.

Shipments from Dalrymple Bay rose to 6.14mn t in March from 5.04mn t in March 2017 and 5.13mn t in February. Queensland coal shipments for March 2017 were affected by Cyclone Debbie. It crossed the Queensland coast on 25 March, closing ports and damaging rail lines, disrupting deliveries to Hay Point and Dalrymple Bay for around a month and to Abbot Point and Gladstone for around a week.

The BHP Mitsubishi Alliance-operated Hay Point reopened on 5 April last week but has also been subject to some draft restrictions following Cyclone Iris. It shipped 4.03mn t in March, up by 21pc on March 2017 and by 9pc on February.

Abbot Point also reopened on 5 April and has no restrictions in place. It was less affected by Cyclone Debbie last year than Hay Point and Dalrymple Bay so its shipments were more in line year-on-year. It shipped 2.14mn t in March compared with 2.19mn t in March 2017 and 2.29mn t in February.

Gladstone shipped 4.97mn t in March down from 5.71mn t in March 2017 and up from 4.86mn t in February. Gladstone was unaffected by Cyclone Iris and only slightly affected by Cyclone Debbie.

Combined shipments from these four largest ports in Queensland rose 6.3pc year on year to 17.29mn t in March, but the year earlier comparison includes the early impacts of Cyclone Debbie particularly on Hay Point and Dalrymple Bay. Exports are expected to be up on the year-on-year comparison in April because the aftermath of Cyclone Debbie was much more disruptive than it will be for Cyclone Iris, which did not cross the coast and only affected port operations. But April shipments are still expected to lower than average because of the closures associated with Cyclone Iris and the maintenance at Dalrymple Bay.

Premium hard coking coal prices tracked lower during March from $232.70/t fob Australia on 1 March to $193 on 29 March. But concerns about the impact of Cyclone Iris have seen a small rebound in early April with prices last assessed by Argus at $196/t.

Thermal coal prices also eased in March from 106.54/t fob Newcastle for high-grade 6,000 kcal/kg NAR and $85.85/t for lower grade 5,500 kcal/kg NAR on 1 March to 90.75/t and 71.67/t respectively on 29 March. Argus last assessed them at $92.15/t and $71.08/t yesterday.