China and India to increase coal imports by 78% .

Kolkata, India 14 December 2010 In a bid to provide fuel to feed their rapidly increasing need for power, China and India may increase imports of coal by 78% to 337Mt next year, driving prices to new record levels, and diverting more supplies from Europe to Asia.

“China may buy 233Mt more of the fuel than it exports next year, up from net imports of 143Mt in 2010,” Citigroup Incorporated said in a report. “India faces a shortfall of 104Mt in the 12 months ending March 2012,” commodity trader mjunction Services Limited said in a note, citing coal minister Sriprakash Jaiswal.

Asia’s two fastest-growing major economies are burning more of the fuel as economic expansion raises demand for electricity. The International Monetary Fund forecasts that China’s gross domestic product next year will expand 9.6% and India 8.4%. China added about 51 gigawatts of coal-fired capacity last year ‒ more than half the total capacity of the U.K., according to data from Daiwa Capital Markets and the U.S. Energy Department.
 
“All the indications are for increased demand in 2011,” Andrew Harrington, an analyst at Patersons Securities Limited in Sydney, said in an interview. “China has become much more important especially because of the expectations that they will be unable to meet their own needs from domestic supply.”

Power-station fuel exports at the Australian port of Newcastle and Richards Bay in South Africa ‒ the world’s two biggest coal export harbours ‒ have climbed to their highest since October 2008, according to data compiled by IHS McCloskey on Bloomberg.

Prices at Newcastle rose to US$114.50/t last week, says IHS McCloskey, and prices at Richards Bay Coal Terminal gained US$2.89 to an average US$110/t .

South Africa accounted for about 30% of India’s thermal coal imports this year, according to ministry data. Shipments in the first nine months of this year increased 16% to 15.2Mt, while China’s purchases surged to 5.1Mt up to October, compared with the 1.52Mt it imported for the entire 2009, according to mjunction Services.

Source : miningreview.com