On December 21, China’s Tariff Commission of the State Council announced that China will reinstate a 3 percent import tariff on metallurgical coal as of January 1, 2024.
China applied a zero provisional import duty rate on coal since May 1, 2022, while which will be effective until December 31, 2023. Imported coal from Australia and Association of Southeast Asian Nations (ASEAN) countries will remain zero amid China-Australia and ASEAN-China free trade agreements. It is forecasted that the reinstatement of a 3 percent import tariff will have some impact for coking coal imports from Russia and Mongolia, because coking coal imports this year were mainly from countries outside Indonesia and Australia. However, market sources believe that the imposition of the duty will not affect the volumes from these two countries much, taking into account the price competitiveness and restricted local coking coal supply, but it may lead to some increase in prices and reduce margin of suppliers to some extent.
Supply of premium grades of coking coal from North America will be even more affected as Australia may gain some competitiveness and overall sources of premium grades are limited in the Chinese market, especially lately due to inspections at mines after a number of fatal accidents. The supply of coking coal will be negatively affected in general in 2024, while demand might improve, thereby its prices may move up in 2024.
As for coke, China will impose zero import tariff in 2024.