Mr Nicholas said India and China were ramping up their domestic coal production to reduce reliance on imports which meant the thermal coal outlook was “increasingly bad, at an accelerating pace”.
Up to $14 billion in coking and thermal coal is exported to China each year, making up 21 per cent of Australia s export market.
“It’s open slather for coal imports into China now – not for Australian coal, but for everyone else,” said Wood Mackenzie s principal Asia Pacific coal analyst Rory Simington.
S&P Global Platts analyst Deepak Kannan said there were several other markets where Australian cargoes could find home like south-east Asia and north-east Asia. Vietnam and the Philippines have emerged as some key buyers for Australian coal while South Korea and Taiwan are also centres of stable demand, he said.