By Ben Sharples
April 1 (Bloomberg) — Coal shipments to China from Australia’s Newcastle port, the world’s biggest export harbor for the fuel used in power stations, rose 83 percent last month as drought conditions sapped hydropower production.
China imported 9.32 percent of the 6.97 million metric tons of coal shipped from Newcastle in March, Port Waratah Coal Services, operator of two terminals at the harbor, said in a report on its Web site. That compares with 5.1 percent in February and 0.87 percent in March 2009.
“Drought conditions in southwestern China have severely restricted hydropower production and will likely lead to an increase in near-term thermal coal demand,” Commodore Research & Consultancy said in a March 29 note. “Conditions started to become severe by the end of February and since then reservoirs in the southwest have dried up.”
A dry spell that started in September has left major rivers in provinces including Yunnan, Guangxi and Guizhou at record lows, China’s Ministry of Water Resources said March 11.
Hydropower generation accounted for 17 percent of China’s total power output last year, according to CLSA Research Ltd.
Rio Tinto Group, Xstrata Plc and BHP Billiton Ltd. are among mining companies that export the fuel from Newcastle.
About 82 percent of the coal exported through the port in 2009 was used for power stations, according to Port Waratah.
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