Yanzhou, China’s fourth biggest state-owned coal miner, has confirmed that subsidiary Yancoal’s bid for Coal & Allied assets in NSW would give China a “big say” in international coal price negotiations.
Yancoal is currently proposing a $3.2 billion purchase of Hunter Valley coal mines, as well as a large stake in Port Waratah Coal Services (PWCS), Newcastle Port’s main operator. This includes the power to appoint and dismiss the chief executive and chairman of PWCS.
Commenting on the deal this week, Yanzhou said that Yancoal “will be a major supplier to Japan and South Korea and Chinese enterprise will have a big say in negotiation and pricing in [the] Asia-Pacific seaborne coal market.”
Australian thermal coal is highly sought after in Asian markets, owing to its high quality. But with growing tensions over China’s activities in the South China Sea, South Korea and Japan may well be concerned about increasing China’s influence over their energy sectors.