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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, 21 August 20
BHP COMMITS TO SELLING ITS THERMAL COALMINES WITHIN TWO YEARS - THE GUARDIAN
Move follows pressure from investors but company stops short of full exit from coalmining
BHP has announced it plans to sell off its ...
Thursday, 20 August 20
MINER BHP CONFIRMS PLANS TO EXIT THERMAL COAL SECTOR - THE SYDNEY MORNING HERALD
The head of mining giant BHP has laid out plans for a reshaping of its global operations by seeking to quit thermal coal mining, offload some cokin ...
Thursday, 20 August 20
LONDON RETAINS ARBITER CROWN - BALTIC EXCHANGE | HFW
Fears that the UK’s decision to leave the European Union would dent the reputation of the nation’s capital as the leader in maritime ar ...
Wednesday, 19 August 20
U.S. COAL STOCKPILES STEADILY INCREASE AFTER REACHING LOWEST LEVEL IN A DECADE IN 2019 - EIA
After reaching their lowest level in more than a decade in March 2019, U.S. coal stockpiles steadily increased to 152 million tons in April 2020, r ...
Wednesday, 19 August 20
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX DOWN 0.26 PCT - XINHUA
China Taiyuan coal transaction price index stood at 124.92 points Monday, down 0.26 percent week on week.
The index, released by Chi ...
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- Globalindo Alam Lestari - Indonesia
- Carbofer General Trading SA - India
- Trasteel International SA, Italy
- Bhushan Steel Limited - India
- PowerSource Philippines DevCo
- Kideco Jaya Agung - Indonesia
- South Luzon Thermal Energy Corporation
- TeaM Sual Corporation - Philippines
- Coastal Gujarat Power Limited - India
- Lanco Infratech Ltd - India
- Riau Bara Harum - Indonesia
- Standard Chartered Bank - UAE
- Semirara Mining and Power Corporation, Philippines
- PTC India Limited - India
- Petron Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Karbindo Abesyapradhi - Indoneisa
- Coal and Oil Company - UAE
- Indo Tambangraya Megah - Indonesia
- Aboitiz Power Corporation - Philippines
- Goldman Sachs - Singapore
- Jindal Steel & Power Ltd - India
- Bukit Baiduri Energy - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Metalloyd Limited - United Kingdom
- Madhucon Powers Ltd - India
- Meralco Power Generation, Philippines
- Global Green Power PLC Corporation, Philippines
- Wilmar Investment Holdings
- Minerals Council of Australia
- Renaissance Capital - South Africa
- Manunggal Multi Energi - Indonesia
- The Treasury - Australian Government
- Mjunction Services Limited - India
- Intertek Mineral Services - Indonesia
- Anglo American - United Kingdom
- Kumho Petrochemical, South Korea
- Baramulti Group, Indonesia
- GN Power Mariveles Coal Plant, Philippines
- India Bulls Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- San Jose City I Power Corp, Philippines
- SMG Consultants - Indonesia
- Bharathi Cement Corporation - India
- CNBM International Corporation - China
- Siam City Cement PLC, Thailand
- Africa Commodities Group - South Africa
- Straits Asia Resources Limited - Singapore
- Directorate Of Revenue Intelligence - India
- Coalindo Energy - Indonesia
- Global Business Power Corporation, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Oldendorff Carriers - Singapore
- Eastern Energy - Thailand
- Vizag Seaport Private Limited - India
- ICICI Bank Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Orica Mining Services - Indonesia
- Savvy Resources Ltd - HongKong
- Marubeni Corporation - India
- Leighton Contractors Pty Ltd - Australia
- Antam Resourcindo - Indonesia
- Indonesian Coal Mining Association
- Maharashtra Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- Ministry of Finance - Indonesia
- Wood Mackenzie - Singapore
- Electricity Generating Authority of Thailand
- Bhatia International Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Jorong Barutama Greston.PT - Indonesia
- Kartika Selabumi Mining - Indonesia
- European Bulk Services B.V. - Netherlands
- IHS Mccloskey Coal Group - USA
- Tamil Nadu electricity Board
- GAC Shipping (India) Pvt Ltd
- Georgia Ports Authority, United States
- Parliament of New Zealand
- Holcim Trading Pte Ltd - Singapore
- GVK Power & Infra Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Formosa Plastics Group - Taiwan
- MS Steel International - UAE
- Interocean Group of Companies - India
- Sree Jayajothi Cements Limited - India
- Ambuja Cements Ltd - India
- Kepco SPC Power Corporation, Philippines
- Sical Logistics Limited - India
- Ministry of Transport, Egypt
- Economic Council, Georgia
- Indogreen Group - Indonesia
- Chettinad Cement Corporation Ltd - India
- Therma Luzon, Inc, Philippines
- Romanian Commodities Exchange
- Indika Energy - Indonesia
- Ind-Barath Power Infra Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Independent Power Producers Association of India
- Energy Link Ltd, New Zealand
- TNB Fuel Sdn Bhd - Malaysia
- VISA Power Limited - India
- Siam City Cement - Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Posco Energy - South Korea
- The University of Queensland
- Star Paper Mills Limited - India
- Altura Mining Limited, Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mintek Dendrill Indonesia
- Kobexindo Tractors - Indoneisa
- Australian Commodity Traders Exchange
- Uttam Galva Steels Limited - India
- Bukit Makmur.PT - Indonesia
- Mercuria Energy - Indonesia
- Singapore Mercantile Exchange
- New Zealand Coal & Carbon
- Dalmia Cement Bharat India
- Thai Mozambique Logistica
- Aditya Birla Group - India
- Commonwealth Bank - Australia
- PNOC Exploration Corporation - Philippines
- Xindia Steels Limited - India
- Alfred C Toepfer International GmbH - Germany
- Tata Chemicals Ltd - India
- Indian Oil Corporation Limited
- Ceylon Electricity Board - Sri Lanka
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Australian Coal Association
- Energy Development Corp, Philippines
- The State Trading Corporation of India Ltd
- Central Java Power - Indonesia
- Cement Manufacturers Association - India
- Rashtriya Ispat Nigam Limited - India
- ASAPP Information Group - India
- Heidelberg Cement - Germany
- Kalimantan Lumbung Energi - Indonesia
- IEA Clean Coal Centre - UK
- Bank of Tokyo Mitsubishi UFJ Ltd
- Central Electricity Authority - India
- Ministry of Mines - Canada
- PetroVietnam Power Coal Import and Supply Company
- Iligan Light & Power Inc, Philippines
- Agrawal Coal Company - India
- Asmin Koalindo Tuhup - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Malabar Cements Ltd - India
- Vedanta Resources Plc - India
- Barasentosa Lestari - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Orica Australia Pty. Ltd.
- London Commodity Brokers - England
- Power Finance Corporation Ltd., India
- Pendopo Energi Batubara - Indonesia
- Bulk Trading Sa - Switzerland
- Meenaskhi Energy Private Limited - India
- Parry Sugars Refinery, India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Videocon Industries ltd - India
- Karaikal Port Pvt Ltd - India
- Attock Cement Pakistan Limited
- Port Waratah Coal Services - Australia
- Merrill Lynch Commodities Europe
- SN Aboitiz Power Inc, Philippines
- Sindya Power Generating Company Private Ltd
- Simpson Spence & Young - Indonesia
- OPG Power Generation Pvt Ltd - India
- SMC Global Power, Philippines
- Semirara Mining Corp, Philippines
- Samtan Co., Ltd - South Korea
- Jaiprakash Power Ventures ltd
- Binh Thuan Hamico - Vietnam
- Kaltim Prima Coal - Indonesia
- Borneo Indobara - Indonesia
- Electricity Authority, New Zealand
- Chamber of Mines of South Africa
- Sarangani Energy Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Thiess Contractors Indonesia
- Grasim Industreis Ltd - India
- Gujarat Sidhee Cement - India
- Medco Energi Mining Internasional
- Essar Steel Hazira Ltd - India
- Bayan Resources Tbk. - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Maheswari Brothers Coal Limited - India
- Bangladesh Power Developement Board
- Toyota Tsusho Corporation, Japan
- Makarim & Taira - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Indian Energy Exchange, India
- Banpu Public Company Limited - Thailand
- Price Waterhouse Coopers - Russia
- Larsen & Toubro Limited - India
- Eastern Coal Council - USA
- Salva Resources Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- Edison Trading Spa - Italy
- Rio Tinto Coal - Australia
- Miang Besar Coal Terminal - Indonesia
- Sakthi Sugars Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- White Energy Company Limited
- Planning Commission, India
- GMR Energy Limited - India
- Timah Investasi Mineral - Indoneisa
- Sojitz Corporation - Japan
- International Coal Ventures Pvt Ltd - India
- Mercator Lines Limited - India
- McConnell Dowell - Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- LBH Netherlands Bv - Netherlands
- Global Coal Blending Company Limited - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Deloitte Consulting - India
- Krishnapatnam Port Company Ltd. - India
- Bhoruka Overseas - Indonesia
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