Australia seeks clarity on coal import

Bloomberg

The Australian government is seeking clarification from Beijing on reports that China has suspended purchases of Australian coal amid heightened diplomatic tensions between the two countries.
Chinese power stations and steel mills have been verbally told to immediately stop using Australian coal, people familiar with the order said, asking not to be identified as the matter is private. Ports have also been told not to offload Australian coal, one of the people said. It isn’t clear when the latest import ban might end or how it might affect long-term contracts that are already in place.
“We are making approaches to Chinese authorities in relation to that speculation,” Trade Minister Simon Birmingham told Sky News. “We take the reports seriously enough certainly to try to seek assurances from Chinese authorities that they are honoring the terms of the China-Australia Free Trade Agreement and their WTO obligations.”
China’s customs administration will further strengthen supervision of imports of the relevant products, a spokesman for the body said, while referring a question on the ban to an unspecified competent government department.
Newcastle benchmark thermal coal prices fell by the most in almost four years as reports of the ban filtered through the market.
The Chinese Foreign Ministry also referred comment to the competent agency, without saying which agency that was.
Ministry spokesman Zhao Lijian said a strong relationship between the two
sides required “calls for joint efforts” and added that
Australia must “uphold the principle of mutual respect and equality and do
more things conducive to China-Australia mutual trust cooperation.”
The ban would mark an escalation in tensions that have already jolted agricultural exports from China’s biggest supplier of commodities. Beijing has objected to a series of diplomatic moves by Canberra that it viewed as supporting the US in its trade and security dispute with China.
Among other things, Prime Minister Scott Morrison in April called for independent investigators to be allowed into the Chinese city of Wuhan to probe the origins of the coronavirus.
China is the top consumer of Australia’s metallurgical coal, accounting for almost a quarter of exports, according to the country’s industry department.