China buys coal from Russia at heavily discounted price amid Ukraine war: Report

Beijing (China), April 23: China has taken full advantage of the Russia-Ukraine war, grabbing the huge discount offered by Moscow on coking coal which is used in steel mills, as Japan and the European Union have barred imports leaving the Russian companies scrambling for buyers. Last month, China imported 321,380 tonnes of liquefied natural gas from Russia, roughly the same amount as in March last year despite an overall 17pc year-on-year drop in its gas imports, driven by skyrocketing prices. Beijing's willingness to work with Moscow will feed frustration in the West, as it undermines the impact of sanctions imposed over the past two months, stated the media reports. China needs coal as it is the most common energy source in the country, accounting for more than half of total consumption despite efforts over recent decades to reduce usage. China is meeting its requirements while assisting Moscow in limiting the impact of Western sanctions, while also keeping in view it does not face sanctions and that its internal food security is not compromised. China has moved to ramp up domestic coal mining, however, its mines produce an inferior quality of material that is unsuited for use in steel mills, forcing it to rely on foreign imports. Imports of the fuel, which is used in making steel, surged to 1.4m tonnes in March from 590,000 a year earlier, suggested the reports. Also Read | Farm loan waivers no solution for farmers' distress: Report Intellasia also stated that Brent crude oil was trading at around $108 a barrel on Wednesday afternoon. In mid-March, traders were selling Urals blend the most common Russian variety at discounts of $25 to $30 a barrel. In 2021, the EU purchased euro 5.2 billion of Russian coal. As a whole, coal imports fell 31% year-on-year, led by a collapse in demand for thermal coal, which is used for power generation, reported Intellasia. Holger Schmieding, an economist at Berenberg, stated that timing "should allow EU members to find alternative sources". It will also give Moscow time to redirect its exports. The lure of cheaper energy, in the form of gas, coal and oil, and low-cost wheat from Russia far outweighs the fear of sanctions as China decided to make deals with Russia for as long as it can. Also Read | After Visa, Mastercards, China's Unionpay suspends operations in Russia -PTC News