London — Imports of thermal coal into the UK fell for a third successive month in April, with the country taking delivery of just 1.27 million mt, an eight-month low, according to customs data Thursday.
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April imports were down 50% on the year and 48% lower than March.
Total UK thermal coal imports in the first four months of 2015 were 9.47 million mt, a 25% decrease on the year-earlier period.
Sources have said that UK coal consumption would cool considerably after a hike in the UK's Carbon Price Support mechanism from GBP9.55/mt of carbon in 2014-2015 to GBP18.08/mt in 2015-2016 which was introduced April 1.
The new rate slashed front-quarter UK clean dark spreads -- the profit margins from coal-fired generation factoring in carbon emissions costs -- from over Eur13/MWh at the end of last year to just above Eur5/MWh currently, according to Platts data.
There were significant falls in supply from two of the three main coal origins which regularly ship to the UK.
Russian deliveries fell 52% on-year and 46% on-month to 563,068 mt, while those from the US were sliced by 92% on-year and 88% on-month to just 54,150 mt.
Traders said that with the spot arbitrage window closed, most US thermal coal shipped to Europe was material on long-term contracts that had been sold forward at higher prices and flows would likely trickle out moving forward.
While imports from Colombia were up 51% on-year at 619,087 mt, this was due to supply disruption a year ago when US producer Drummond was banned from exporting Colombian coal for three months for failing to install direct loading facilities at its terminal.