China’s coking coal output this year would amount to 513 million tons while its consumption would be 569 million tons, resulting in a supply shortage of 56 million tons. China and India have replaced South Korea and Japan as the world’s largest importers of coking coal, suggesting the international prices of such a raw material will continue an upward movement in the medium and long run.

China’s reserves of coking coal account for only 21.9 percent of its total coal resources. Shanxi harbors 52.4 percent of the country’s total coking coal reserves and produces a third of the country’s total coking coal. The import volumes of coking coal into China are forecast to increase by 10 percent this year, lower than the staggering growth rate of 37.3 percent in 2010. Soaring oil prices, a weaker dollar and the resources tax reform in Australia will push the international prices of coking coal even higher this year.

Downstream sectors will also take their part in supporting the coking industry. This year China will increase fixed assets investment in public infrastructures including water conservancy, and work hard to build 10 million low-income housing and redevelop run-down areas. As a result, steel demand will steadily rebound, as will the demand for coking coal.