A drop in coastal coal demand has seen domestic Chinese freight rates slip to their lowest since early August, as northern utilities have already built up winter inventories prior to the peak demand season. The country's policy to shift coal-fired power plants to northern and western regions, closer to coal sources, also contributed to the 4% YoY drop in consumption to 767,000 metric tonnes per day (mt/d) in August. China's coal imports fell by a record amount of 4.9%, or 1.35 million tonnes, from July to August this year, according to official data released on Thursday. However, analysts said stronger winter demand could see an uptick in freight rates.
A drop in coastal coal demand has seen domestic Chinese freight rates slip to their lowest since early August, as northern utilities have already built up winter inventories prior to the peak demand season. The country's policy to shift coal-fired power plants to northern and western regions, closer to coal sources, also contributed to the 4% YoY drop in consumption to 767,000 metric tonnes per day (mt/d) in August. In September coal consumption fell 10% to 638,000 mt/d, and plunged 20% in October to 516,000 mt/d. However, analysts said stronger winter demand could see an uptick in freight rates.