According to the estimate of the Australian Bureau of Resources and Energy Economics (BREE) released on June 27, Australia's metallurgical coal exports in 2012 are forecast to increase by 12 percent to 149 million mt as mines in Queensland recover from flood-related disruptions in 2011. Exports in 2013 are forecast to increase further by nine percent to 163 million mt.
According to BREE, in 2012 US metallurgical coal exports are forecast to decrease by seven percent relative to 2011 to total 51 million mt. Exports are forecast to decline by a further 11 percent in 2013 to total 46 million mt. The decline in US metallurgical coal exports is partly a result of a decline in import demand in Europe and from the idling of a number of coal mines.
Meanwhile, Australia's metallurgical coal export earnings in the financial year 2011-12 ending June 30 is forecast to increase by two percent compared to the previous fiscal year to reach $30 billion. However, during the fiscal year 2012-13 earnings are forecast to decline by two percent to $29.7 billion despite high export volumes, due to forecast lower contract prices for 2012-13.
According to the report, world trade of metallurgical coal is projected to increase by six percent to reach 286 million mt in 2012. World metallurgical trade is forecast to increase by a further three percent to 296 million mt in 2013 supported by import growth in China and India.
The report also notes that in the first three months of 2012 China increased its imports of metallurgical coal by around 17 percent compared to the previous quarter. The higher volumes were sourced from increased exports from Australia and Mongolia. For 2012 as a whole, China's metallurgical coal imports are forecast to increase by 15 percent to 53 million mt, partly as a result of restocking at steel mills, but also from forecast robust steel production throughout 2012. In 2013, China's imports are forecast to increase by a further six percent to 56 million mt, as metallurgical coal consumption outpaces growth in domestic production.
The other major source of metallurgical coal import growth is India, where imports are forecast to increase by six percent in 2012 to total 34 million mt, and by a further six percent to 36 million mt in 2013. Meanwhile, imports by the EU are forecast to remain largely unchanged in 2012 and 2013 from 2011 at around 46 million mt. The lack of growth in 2012 and 2013 is consistent with stagnant steel production forecast for these years.