DBCT queue hits new high: Update

Updates with traders' comment

Vessel queues off the Queensland port of Dalrymple Bay Coal Terminal (DBCT) in Australia have blown out to a new record of 46, with some scheduled to wait for almost four weeks before being loaded with coal.

The queue is just above the 45 in December last year, when congestion at the port helped push premium hard coking coal prices up to $260/t fob Australia. The price is currently at $224.35/t, up from $173/t at the start of August. The queues at DBCT, which had eased slightly in the first half of this year, began to grow again in July and August. They have remained at around 40-45 for much of the past three months as the port has had maintenance.

The longer queues have pushed out waiting times at the port, with a vessel that arrived on 17 November not due to depart until 13 December. The extended waits are adding to demurrage costs for coal mining firms using DBCT.

The port appears to be loading within its normal range, with November throughput tracking at similar levels seen in October, according to analysis of the shipping data gathered by Argus. DBCT shipped 6mn t of coal in October, up from 5.85mn t September but down from 6.64mn t in October 2017, according to port data.

The growing congestion at Queensland export terminals recalls the December-January period last year when prices spiked to $260/t fob Australia, a Singapore-based trader said. "It is a major reason why I have taken a very long position and it looks like it could blow out again. And this year the Chinese could be buying because of the domestic shortage."

The blowout in vessel queues this time last year was put down to overallocation by miners using the port, ahead of the wet season in November-April. This appears to be the case again this year, with maintenance at two of DBCT's berths adding to the congestion. The wet season adds risk of export delays from weather impacts on mining and rail deliveries to the ports.

The 46 vessels waiting to access DBCT are joined by a further nine waiting to access the adjacent port of Hay Point, which is owned by the world's largest supplier of seaborne coking coal BHP Mitsubishi Alliance.

BHP warned that its shipments may be affected this quarter by a longwall move at its Broadmeadow mine and shipments for November are tracking about 10pc behind those seen in October, according to initial shipping data. Hay Point shipped 4.12mn t of coking coal in October, in line with the 4.17mn t shipped in September and up from 2.95mn t in the same month last year amid a major maintenance programme.