Japanese traders have resumed coal imports from Colombia, which ended in January 2014, ordering around 50 to 100 kt of Colombian coal for delivery in the summer months.
Colombian miners are targeting Asian buyers to find new customers as their traditional North American and European markets remain sluggish. They succeeded in reducing costs and freight rates, enabling profitable exports to Asia; the extension of the Panama Canal, expected in June 2016, should also contribute to boosting Colombian exports to Asia.
South Korea's power utilities have also recently signed large orders of Colombian coal: South Korea's East-West Power has ordered 670 kt of Colombian coal for delivery between June and August 2016, while Korea Midland Power (KOMIPO) has ordered 250 kt of Colombian coal for delivery between July and September 2016 at US$44/ton, i.e. US$6/ton less than Australian coal. Higher quality and competitive prices are likely to erode the market share of Indonesian and Australian coals and to depress Pacific prices.