China has expanded the capacity of rail lines between its domestic coal fields and its industrial heartland so quickly it will be able to cut imports by 25 per cent by 2025, dealing a serious blow to Australian exporters, analysis has found.

“Our findings are clear; Beijing’s plans for rapid decarbonisation and energy security signal
the end for Australia’s current coal export boom,” said Australian National University’s Dr Jorrit Gosens, who built the modelling forecast with his colleague Professor Frank Jotzo.

A worker shovels up coal on a freight train in Huaibei, Anhui province in January.

A worker shovels up coal on a freight train in Huaibei, Anhui province in January.Credit:HUANG SHIPENG/Future Publishing via Getty Images

“And this isn’t going to happen far off into the future; it is imminent. Our modelling predicts
Chinese demand for Australian thermal coal will fall to between 30 and 40 million tonnes in 2025, down from about 50 million tonnes in 2019,” Gosens said.

China has been reliant on imported coal during its boom over recent decades because it did not have the infrastructure to move its own coal around the country quickly and cheaply enough to meet demand.

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But due to an infrastructure building boom prompted by a political determination to achieve energy independence, domestic coal infrastructure is now catching up with demand, Gosens said.

One of China’s new rail lines, the Haijo coal railway, was commissioned in 2014 and completed in 2019, linking coal fields of Inner Mongolia with central China’s heartland. It can move 200 million tonnes of coal per year, which is equivalent to all of China’s thermal coal imports, or all of Australia’s global thermal coal exports.

No Australian coal is exported to China now due to a trade dispute, but Gosens said should trade resume, Australian exports will likely shrink rapidly. Should the trade not resume, Australian exports will still be hit hard as other suppliers fill gaps in the market, he said.

Gosens said the ANU’s model was more sophisticated than other models that had already predicted a decline in the global seaborne coal trade for the same reasons.



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