Perhaps Mongolia Coal will completely withdraw from the Chinese market?

May 29, 2024, 11:58 AM

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Highlights at a glance

Mongolia's coal exports to China surged in 2022, especially after Australia withdrew. Despite internal chaos linked to anti-corruption efforts, Mongolia sought to maintain its market with China. In February 2023, it ended a sales agreement but opened auctions to retain trade, reflecting a price increase this year.

Mongolia's coal exports to China have been significant, especially since Australian coal withdrew from the Chinese market. In 2022, Mongolia exported a total of about 31 million tons, of which 29 million tons were exported to China, accounting for over 90%.

Mongolia not only received EU assistance, but also conducted joint military exercises with the United States, which also created chaos in Mongolia at the end of 2022. The reason for the chaos in Mongolia at the end of 2022 seemed to be the "anti-corruption" of state officials, but it was actually inflation that reduced the happiness of the people. Some forces with ulterior motives have wantonly promoted the "threat theory" and dumped this big pot on China.

In February 2023, Mongolia unilaterally announced the termination of the sales agreement with China.

In order not to completely lose the Chinese market, Mongolia actually opened an auction for the Chinese side to conduct import transactions. Undoubtedly, the auction price is much higher than the current price.

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