Seaborne coal exports from the US are on the rise, which is lifting the global dry bulk shipping industry, according to a recent report from BIMCO, the international shipping association.
US coal exports appear to be in their third quarter of growth – an increase that is driven mostly by a growing demand from European importers.
East Asian importers have also increased imports of coal from the US, which generates a large amount of tonne-miles, benefiting the greater the dry bulk shipping industry.
BIMCO chief shipping analyst Peter Sand said a rising US coal trade has a multiplying effect on the dry bulk shipping industry, as it provides some of the longest sailing distances.
“East Asian importers source 78% of their US coal from Norfolk, Virginia and Baltimore, Maryland and thereby accept a journey of up to 45 sailing days at an average speed of 13 knots (14,000 nautical miles),” he said.
In the first five months of 2017, US coal exports are up 54% in total volume on the same period last year, and up 60% in terms of tonne-miles.
“As the average sailing distance has grown more than total volume, it emphasises how the US has exported more to importers further away, primarily to East Asian destinations,” the report reads.
Mr Sands said BIMCO expected the second quarter of 2017 to go beyond the levels seen in the first quarter in terms of tonne-miles and deliver the highest second quarter demand in four years.
“If US coal exports remain high throughout 2017 it will have a solid effect on the global seaborne coal trade and support the overall improvement in the dry bulk shipping industry,” he said.