BHP confirms Chinese customers have cancelled orders for Australian coal

BHP has confirmed that Chinese customers have asked for deferrals of their coal orders amid reports that China has stopped taking shipments of Australian coal.

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The company’s chairman Ken MacKenzie told reporters after BHP’s annual general meeting (AGM) that some coal exports had been stalled.

“We understand there may be some new developments relating to how China plans and moderates imports versus its own domestic coal production,” he said.

“Our commercial team has recently received deferment requests from some of our Chinese customers.”

The confirmation from BHP follows reports from commodity analyst S&P Global Platts that Chinese steel producers and Chinese power firms were ordered to stop importing Australian coal.

Economic analysis firm IHS Markit said some Chinese ports had been told not to accept Australian coal and those shipments were being sold to other countries at the last minute.

Coal exports have been delayed into Chinese ports in the past.

On Tuesday, China’s Customs Department said it would tighten import supervision of Australian exports.

Coal is the latest export to be caught up in trade tensions between Australia and its biggest trading, China.

China has imposed trade duties on Australian barley and beef exports and wine exports are now also the subject of an anti-dumping investigation.

A major point of tension has been Australia’s banning of Chinese telecommunications firm Huawei from being involved the rollout of 5G mobile infrastructure over national security concerns.

Mr Morrison’s call for an investigation into the origins of the COVID-19 pandemic, believed to have originated in the Chinese city of Wuhan, has also damaged relations.

At the AGM, BHP chief executive Mike Henry said the impact of COVID-19 made the outlook for commodities uncertain.

“However, the strength and consistency of the economic recovery underway in China does provide a measure of confidence and optimism,” he said.

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