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Why China Is Facing a Power Crunch and What It Means

China traditionally has been a major importer. But it stopped buying the highly energy-efficient Newcastle grade from Australia starting last year amid a political dispute between the once-close trading partners, leading to sporadic shortages. That tension isn’t likely to ease as U.S. President Joe Biden seeks to rally allies, including Australia, to counter Beijing’s influence across the Indo-Pacific region. Rising purchases from Indonesia helped make up for the missing Australian coal this year, but energy demand in Southeast Asia’s biggest economy also soared, and increases from other sources are in doubt. Mongolia, China’s resource-rich neighbor, sold less coal this year partly due to China’s strict border controls to prevent the spread of Covid-19.

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