Australia has also found renewed buying interest from Europe, with thermal coal imports totalling 537,000 tons in the first quarter of this year LONDON: European buyers are increasing shipments of coal from across the globe against a backdrop of a proposed European Union ban on Russian imports and the scramble to relieve tight gas supplies, according to data and shipping sources. The European Commission on Tuesday proposed new sanctions against Moscow over its invasion of Ukraine, including a ban on buying Russian coal and on Russian ships entering EU ports. The new restrictions come at a time of uncertainty about future gas deliveries from Russia to the EU later this month after the Kremlin’s demand that buyers start paying Russian gas giant Gazprom in roubles. In March, European countries imported a total of 7.1 million tons of thermal coal, which is used in power and heat generation, a 40.5 percent increase year-on-year and the highest level since March 2019, analysis from shipbroker Braemar ACM, based on ship tracking data, found. “Despite Russian coal shipments to Europe in March still continuing at pre-war levels, the expected alteration in coal flows into Europe has started to show,” Braemar dry bulk analyst Mark Nugent said. “Shipments from Colombia and the United States have been strong in response to the conflict with Atlantic suppliers providing the most cost-efficient alternative for European end-users.” The EU depends on Russia for around 45 percent of its coal imports, 45 percent of its gas imports and around 25 percent of its oil imports, according to the European Commission website. Braemar data showed 3.5 million tons of Russian thermal coal were imported into the EU in March, the highest monthly total since October 2020. On a weekly basis, March 28-April 1 saw the highest levels of Russian thermal coal imports since the Feb. 24 invasion began, with 887,000 tons of Russian thermal coal imported into the EU, according to Braemar. German coal importers’ group VDKi on Wednesday said the country should be able to find alternatives to Russian hard coal imports by the peak demand winter season, but there will be technical issues and increased costs. Thermal coal imports from Colombia totalled 1.3 million tons in March, rising by 47.3 percent year-on-year, Braemar data showed. Imports from the US in March totalled 809,000 tons, rising by 30.3 percent year-on-year and at their highest level since October 2019. Imports from South Africa also picked up with 287,000 tons arriving in March versus no shipments in March last year. Australia has also found renewed buying interest from Europe, with thermal coal imports totalling 537,000 tons in the first quarter of this year, versus no shipments over the same period in 2021, Braemar said. But Indonesia and Australia, among the world’s top coal exporters, have hit their production limits and are unlikely to meet Europe’s demand for additional supplies if the European Union bans Russian coal imports, mining executives said. “There is greater concern over the risks with trading Russian coal (due to broader sanctions), so that is already having an impact on shipments,” one shipping source familiar with the trade said. Although it is still more expensive to burn gas to produce power than coal, the price of thermal — which is for heating and power generation — has reached all-time highs this year. Alex-Stuart Grumbar, dry bulk analyst with shipping consultancy MSI, said Europe’s need to import more coal from sources further afield would be positive for the larger panamax and capesize shipping segments on long-haul coal trade routes. “The initial disruption to trade patterns will be positive for dry bulk markets, though ultimately, this will push global coal prices higher, incentivising China and India to produce more coal domestically,” Grunbar said.