Surging Chinese Coal Imports to Support API2 Prices

Despite global efforts to transition towards renewable energy sources, China's appetite for coal remains robust, driven by the nation's soaring demand for air conditioning during the sweltering summer months. According to estimates from DBX, Chinese imports of Colombian coal are projected to reach a staggering 1.7 million tonnes in May, marking a substantial 60% month-on-month increase and a remarkable 590% year-on-year surge.

This unprecedented surge in coal imports underscores China's continued reliance on fossil fuels to meet its energy needs, particularly during periods of peak demand. As the summer heat intensifies, the widespread use of air conditioning units requires the burning of vast quantities of coal to satisfy the voracious energy appetite.

This heightened demand for coal is expected to buoy global benchmark prices, including the API2 index. DBX anticipates that the coal market will remain well-supported throughout the summer season with Asia increasing its coal imports.

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