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Will China become self-sufficient?

More than 8 in 10 delegates polled at the 33rd Coaltrans World Coal Conference in Berlin believed that China will be a net importer of thermal coal for the next 5 years. This was up from 69 per cent at the Coaltrans Asia Conference in Bali, which took place in June of this year.

Over half of delegates said that China would not slow down coal imports and eventually become self-sufficient because imported coal would still be more “competitive” in the southern areas of the country.
 
Around 18 per cent thought this that would not happen for at least the next 5 to 10 years because the implementation of environmental regulation will take time, while 14 per cent said it would be better for China to import coal than produce on a massive scale domestically because the latter would cause long term damage to the environment.
 
However, 9 per cent of delegates believed that China could stop being a net importer in the next 5 years if domestic production were to increase significantly and if the vast country’s infrastructure was improved, especially railways.  A further 7 per cent said that this could materialise with environmental regulations.
 
Zenny Tran, Coal Team Leader at Ginga Petroleum, said that the southern part of China still needs to import because it is more “economical” than transporting coal by railway from the North to the South.
 
Gareth Carpenter, Managing Editor of International Coal at Platts and another panellist at the event, added: “While I do agree with the majority of people who think that China will continue to be a net importer, I don't think we can rule out the possibility that at some point China will become self-sufficient.
 
“Infrastructure issues are very important. Most of Chinese demand is in the South of the country, but there are moves to build power plant projects close to the mining regions in the North. If that happens that could swing things more towards a domestic market.”
This content is provided by Coaltrans Conferences for informational purposes only, and it reflects the market and industry conditions and presenter’s opinions and affiliations available at the time of the presentation.

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