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Wednesday, 19 October 11
METALLURGICAL COAL PRICES TO DROP BELOW US$240/TONNE - WOOD MACKENZIE
 Wood Mackenzie Says Metallurgical Coal Prices to Drop Below US$240/tonne by Q4 2012 But Long-term Demand Fundamentals Remain Robust
Wood Mackenzie’s Near-Term Market Outlook cautions of falling metallurgical coal prices from now to Q4 2012, dropping from the current quarterly price of US$285/tonne for premium hard coking coal to under US$240/tonne. However, this price remains significantly above the marginal cost of production and longer-term drivers point to robust metallurgical coal demand in the Asia-Pacific market.
Prakash Sharma, Coal Market Analyst says, “Prices have started to fall from the last quarter and will continue to decline due to softening demand and the recovery of supply from flood-hit basins earlier in the year. The weakening demand is largely attributed to the global macroeconomic slowdown which appears to have accelerated through the summer in much of the developed world. Leading industrial indicators suggest a sharp deterioration in manufacturing activity – reflected by the decline in global steel production.”
Wood Mackenzie’s Senior Economist, Ed Rawle says, “The global economy has entered a period of extreme uncertainty. Wood Mackenzie’s global Gross Domestic Product growth forecast has been revised down from 3.1% to 2.8% in 2011, and 3.7% to 3.6% in 2012. But there are significant downside risks to this outlook. The Eurozone debt crisis remains unresolved and threatens to trigger a European banking crisis. Due to the sheer scale of the European banking sector, this is of major concern since it would likely lead to a global banking crisis with implications for us all.”
Despite near-term downward price movements, Wood Mackenzie says that several factors have the potential to turn this trend. Firstly, some mines have not fully recovered from the 2011 Queensland floods. The approaching wet season could lead to further delays in some mines attaining full production levels. Secondly, persistent worker-strikes at BHP Billiton Mitsubishi Alliance operated mines have the ability to tighten the market as these operations produce 26% of globally traded metallurgical coal. Lastly, US low-volatility supply has been curtailed by mine outages and changes in blending techniques following various mergers.
In the long-term , investors are still energized by the coking coal space with high margins in a current supply-constrained world. Mr. Sharma explains, ”Strong long-term demand is likely to support Mergers & Acquisitions (M&A) activity that has been ongoing since early 2008. Demand growth will be led by emerging markets with Asia accounting for 75% of global metallurgical coal demand by 2030. China and India will be key demand drivers, contributing to 60% of Asia Pacific’s total import demand.”
The growth potential of China and India can be attributed to their economic climate relative to the rest of the world. Mr. Rawle says, “The bright spot amidst the uncertainty continues to be the developing world. Specifically, we see China and much of Asia powering ahead, drawing on growth drivers that have been deliberately de-coupled from troubled developed economies over the past couple of years.”
Wood Mackenzie says that China’s reliance on coking coal imports will increase due to insufficient supply of high quality coking coal in the domestic market. China is forging ahead with plans to close all blast furnaces under 1,000 cubic metres and install new blast furnaces with capacities in excess of 2,000 cubic metres. The larger furnaces need coke produced from high-quality coking coal. As a result, a larger volume of this type of coal will be required and China will have to turn to suppliers of the likes of Australia, Mongolia and, to a lesser extent, Mozambique who are all expanding supply.
In summary, Mr. Sharma says, ”The industry should expect premium metallurgical coal prices to fall to a price below US$240/tonne from now until Q4 2012. Although further downside price risks remain given ongoing macroeconomic uncertainty and new sources of supply entering the market place, the constant threat of additional unpredictable mine outages and the upcoming rainy season in key supply basins should keep them from falling too far. Long-term demand also remains strong in emerging markets.”
Editor’s notes:
Wood Mackenzie is the most comprehensive source of knowledge about the world’s energy and metals industries. We analyse and advise on every stage along the value chain - from discovery to delivery, and beyond - to provide clients with the commercial insight that makes them stronger. For more information visit: www.woodmac.com. Wood Mackenzie is a research consulting company and it is our preference is to be referred to as research consultants.
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Friday, 04 September 20
IN A DEEPENING DEBT HOLE OF $34 BILLION, INDONESIA’S PLN MUST STOP DIGGING - IEEFA
The utility has added IDR100 trillion in debt annually for the last five years
Utilities globally started changing the way they do business ye ...
Friday, 04 September 20
KOMIPO INVITED BIDS FOR AUSTRALIAN MIN 5,700 NCV COAL FOR NOVEMBER
COALspot.com: Korea Midland Power Co. Ltd, has issued an International tender for 260,000 MT Min.5,700 kcal/kg NCV coal November, 2020 loading. Acc ...
Thursday, 03 September 20
BRINGING SERVICES OF FTCCI CLOSER TO THE EXPORTERS AT GMR AIR CARGO COMPLEX AT SHAMSHABAD
Press Release: “FTCCI Trade Facilitation Services at your doorstep now” says J.S. Chandrashekar, IRS., Principal Commissioner of Custom ...
Thursday, 03 September 20
CHINA'S BENCHMARK POWER COAL PRICE REMAINS FLAT - XINHUA
China’s benchmark power coal price remained flat during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
Wednesday, 02 September 20
COAL PRODUCTION FALLS 7% IN APR-AUG; OFF TAKE DIPS 13.4% - FINANCIAL EXPRESS
In the month of August coal off take also increased 9.3% y-o-y to 44.34 MT as compared with 40.57 MT in the same period last year.
C ...
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- Sarangani Energy Corporation, Philippines
- Tata Chemicals Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Central Electricity Authority - India
- Medco Energi Mining Internasional
- Eastern Energy - Thailand
- Makarim & Taira - Indonesia
- Kapuas Tunggal Persada - Indonesia
- South Luzon Thermal Energy Corporation
- White Energy Company Limited
- Lanco Infratech Ltd - India
- Orica Mining Services - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Indika Energy - Indonesia
- ICICI Bank Limited - India
- Central Java Power - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Kobexindo Tractors - Indoneisa
- Global Green Power PLC Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- International Coal Ventures Pvt Ltd - India
- Independent Power Producers Association of India
- Iligan Light & Power Inc, Philippines
- Metalloyd Limited - United Kingdom
- India Bulls Power Limited - India
- Xindia Steels Limited - India
- PowerSource Philippines DevCo
- Ministry of Finance - Indonesia
- GVK Power & Infra Limited - India
- Power Finance Corporation Ltd., India
- Indogreen Group - Indonesia
- Grasim Industreis Ltd - India
- San Jose City I Power Corp, Philippines
- Indian Energy Exchange, India
- LBH Netherlands Bv - Netherlands
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Gujarat Sidhee Cement - India
- Meenaskhi Energy Private Limited - India
- Carbofer General Trading SA - India
- Renaissance Capital - South Africa
- Star Paper Mills Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Toyota Tsusho Corporation, Japan
- MS Steel International - UAE
- Savvy Resources Ltd - HongKong
- Ind-Barath Power Infra Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Kartika Selabumi Mining - Indonesia
- Globalindo Alam Lestari - Indonesia
- Wood Mackenzie - Singapore
- Africa Commodities Group - South Africa
- SMC Global Power, Philippines
- CNBM International Corporation - China
- Bharathi Cement Corporation - India
- Orica Australia Pty. Ltd.
- Altura Mining Limited, Indonesia
- Semirara Mining Corp, Philippines
- Siam City Cement - Thailand
- IEA Clean Coal Centre - UK
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Agrawal Coal Company - India
- Videocon Industries ltd - India
- Riau Bara Harum - Indonesia
- Bhatia International Limited - India
- Barasentosa Lestari - Indonesia
- Jindal Steel & Power Ltd - India
- Australian Commodity Traders Exchange
- Bahari Cakrawala Sebuku - Indonesia
- Latin American Coal - Colombia
- Kepco SPC Power Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Deloitte Consulting - India
- Simpson Spence & Young - Indonesia
- McConnell Dowell - Australia
- Interocean Group of Companies - India
- Aditya Birla Group - India
- Kalimantan Lumbung Energi - Indonesia
- OPG Power Generation Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Kumho Petrochemical, South Korea
- The State Trading Corporation of India Ltd
- PTC India Limited - India
- Sakthi Sugars Limited - India
- Jaiprakash Power Ventures ltd
- Romanian Commodities Exchange
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Maharashtra Electricity Regulatory Commission - India
- Coastal Gujarat Power Limited - India
- New Zealand Coal & Carbon
- Mercuria Energy - Indonesia
- Attock Cement Pakistan Limited
- Port Waratah Coal Services - Australia
- TeaM Sual Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- Bukit Baiduri Energy - Indonesia
- Eastern Coal Council - USA
- Chettinad Cement Corporation Ltd - India
- Petron Corporation, Philippines
- Chamber of Mines of South Africa
- Meralco Power Generation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Minerals Council of Australia
- Bulk Trading Sa - Switzerland
- Indian Oil Corporation Limited
- Maheswari Brothers Coal Limited - India
- Electricity Authority, New Zealand
- Price Waterhouse Coopers - Russia
- Global Business Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Parry Sugars Refinery, India
- ASAPP Information Group - India
- Indonesian Coal Mining Association
- Coalindo Energy - Indonesia
- Planning Commission, India
- Gujarat Mineral Development Corp Ltd - India
- Thiess Contractors Indonesia
- Ministry of Transport, Egypt
- Trasteel International SA, Italy
- Formosa Plastics Group - Taiwan
- Manunggal Multi Energi - Indonesia
- Bayan Resources Tbk. - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Wilmar Investment Holdings
- Siam City Cement PLC, Thailand
- Therma Luzon, Inc, Philippines
- Australian Coal Association
- Indo Tambangraya Megah - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Georgia Ports Authority, United States
- Vizag Seaport Private Limited - India
- Antam Resourcindo - Indonesia
- Ambuja Cements Ltd - India
- Sical Logistics Limited - India
- Binh Thuan Hamico - Vietnam
- Dalmia Cement Bharat India
- Sree Jayajothi Cements Limited - India
- Malabar Cements Ltd - India
- Madhucon Powers Ltd - India
- Banpu Public Company Limited - Thailand
- Miang Besar Coal Terminal - Indonesia
- Energy Link Ltd, New Zealand
- Gujarat Electricity Regulatory Commission - India
- Bangladesh Power Developement Board
- Cement Manufacturers Association - India
- Larsen & Toubro Limited - India
- Heidelberg Cement - Germany
- IHS Mccloskey Coal Group - USA
- VISA Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mercator Lines Limited - India
- Timah Investasi Mineral - Indoneisa
- CIMB Investment Bank - Malaysia
- Intertek Mineral Services - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Standard Chartered Bank - UAE
- Singapore Mercantile Exchange
- Aboitiz Power Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Edison Trading Spa - Italy
- GAC Shipping (India) Pvt Ltd
- Uttam Galva Steels Limited - India
- Ministry of Mines - Canada
- Samtan Co., Ltd - South Korea
- Posco Energy - South Korea
- SMG Consultants - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Ceylon Electricity Board - Sri Lanka
- Karaikal Port Pvt Ltd - India
- Bhushan Steel Limited - India
- Economic Council, Georgia
- Parliament of New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Thai Mozambique Logistica
- Goldman Sachs - Singapore
- Energy Development Corp, Philippines
- Sindya Power Generating Company Private Ltd
- Sojitz Corporation - Japan
- TNB Fuel Sdn Bhd - Malaysia
- European Bulk Services B.V. - Netherlands
- Rio Tinto Coal - Australia
- Anglo American - United Kingdom
- Krishnapatnam Port Company Ltd. - India
- Kaltim Prima Coal - Indonesia
- Baramulti Group, Indonesia
- Oldendorff Carriers - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Kideco Jaya Agung - Indonesia
- Commonwealth Bank - Australia
- Electricity Generating Authority of Thailand
- Global Coal Blending Company Limited - Australia
- Coal and Oil Company - UAE
- Leighton Contractors Pty Ltd - Australia
- The Treasury - Australian Government
- Vedanta Resources Plc - India
- Borneo Indobara - Indonesia
- London Commodity Brokers - England
- Mjunction Services Limited - India
- Tamil Nadu electricity Board
- Billiton Holdings Pty Ltd - Australia
- GMR Energy Limited - India
- Straits Asia Resources Limited - Singapore
- Essar Steel Hazira Ltd - India
- Pendopo Energi Batubara - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- GN Power Mariveles Coal Plant, Philippines
- SN Aboitiz Power Inc, Philippines
- Marubeni Corporation - India
- Merrill Lynch Commodities Europe
- Bukit Makmur.PT - Indonesia
- Mintek Dendrill Indonesia
- The University of Queensland
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