Estimated total congestion, based on excess demand, increased to a record high 65.5 Mdwt in August, a level not seen in data records dated back to 2005. Total congestion was 24 Mdwt higher than the same month last year and is now equivalent to 7.5% of the total dry bulk fleet, up from 6.1% last month.
Severe congestion at Chinese ports started to build up this spring and has continued during the summer. Especially at many major coal ports where tight control on intake is an issue. Some sources report that waiting time for customs clearance is currently about two months. Beijing has yet to comment on measures for the rest of 2020. The number of days waiting at Chinese
coal ports is at the highest level since 2008. Improving industrial activity recently points to stronger domestic coal consumption, while coal production so far this year is flat, yoy.
Chines iron ore imports increased 24% yoy to a record 112.6Mt in July. Coal imports reached 26.1Mt, bringing imports so far this year to 200Mt, out of a presumed quota of 290Mt.
The Australian met office has raised the likelihood of La Niña this year. In 2010-11, the last significant La Niña, a record rainfall restricted output at 85% of Queensland coal mines.
Vale announced mid-August it’s sticking to plans of iron ore production capacity of 400Mt per year by 2022. Ore production in 2020 is expected to reach 310Mt, the lower end of Vale’s 2020 guidance. Brazil iron ore exports in July reached 34.1Mt, the same level as last year.
Ingrid N. Aas
Senior Shipping Economist