According to the Korea International Trade Association, South Korea's LNG imports from January to September this year totaled 32.87 million tons, a 6.4% decrease compared to the same period last year. Among these, imports from the Middle East plummeted to 2.42 million tons, a 66.2% drop. In contrast, imports from the United States and Canada surged to 7.82 million tons, marking a 102.9% increase.
The decline in Middle Eastern imports was significantly influenced by reduced shipments from Qatar. Imports from Qatar fell from 5.39 million tons in the first nine months of last year to just 1.70 million tons this year, a decrease of 68.6%. The share of Qatari LNG in total imports dropped from 15.4% to 5.2%. Due to supply disruptions caused by the war, Qatar's LNG shipments were recorded at zero during April to June and August to September this year.
Conversely, imports from the U.S. increased by 41.7% to 4.85 million tons, while Canadian imports skyrocketed by 587.6% to 2.975 million tons. The combined share of U.S. and Canadian LNG rose from approximately 11.0% to 23.8%. Australia remained the largest supplier, accounting for 29.3% of total imports.
Korea Gas Corporation (KOGAS) reported that it has reduced the share of Middle Eastern LNG in its own imports from about one-third to the low 10% range, increasing supplies from Australia and Canada. This figure is distinct from the overall import share, which includes private direct imports.
A KOGAS official stated, "We have supplemented the shortfall in Qatari LNG with volumes secured under long-term contracts as part of our emergency response plan established at the beginning of the year."
However, while diversifying supply sources to mitigate shortages, the average price of LNG imports has risen. According to the Korea Customs Service, the total value of LNG imports from January to September reached $20.61059 billion, a 2.4% increase from the previous year. The average import price per ton rose by 9.5% to $627.10.
In September, the average import price soared to $852.50 per ton, up 59.9% from $533.30 in the same month last year. Although the import volume decreased by 7.8% to 3.564587 million tons, the total import value surged by 47.4% to $3.03888 billion.
This data includes volumes from both KOGAS and private direct importers. However, it is difficult to attribute the rise in average import prices solely to the increased imports from North America, as prices vary based on contract terms and the proportions of long-term versus spot purchases.
LNG price increases could lead to higher fuel costs for domestic power generation and industrial sectors. KOGAS's natural gas rates for general power generation have risen from 16,323.63 won per gigajoule in January to 25,087.86 won in October, a 53.7% increase.
KOGAS maintains that it has secured sufficient supply for the winter season. Considering current inventories and scheduled import timelines, simulations indicate that adequate supply can be maintained even in the event of a colder-than-average winter.
A KOGAS official noted, "We have diversified our supply sources and proactively secured volumes, so the structure does not rely on spot purchases that could lead to sudden cost increases this winter. We are also on track to import the planned volumes from Australia and Canada, with remaining supplies expected to arrive without issues." However, specific details regarding inventory and annual import plans remain confidential due to contractual obligations and trade secrets.
If additional purchases become necessary beyond the pre-secured volumes, fluctuations in international spot prices could impact costs. This has led to calls for managing demand through price signals.
Choi Hong-jong, an economics professor at Dankook University, stated, "If winter temperatures drop or if Europe experiences a cold snap leading to sudden shortages, spot prices could rise, increasing purchasing burdens. It is an unpredictable situation." He emphasized that inducing demand response through price adjustments could help reduce consumption and curb the need for additional spot purchases.
* This article has been translated by AI.
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