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Wednesday, 13 June 12
LOW COAL PRICES COULD CHANGE SUPPLY SIDE DYNAMICS - FITCH RATINGS
 Fitch Ratings believes that the weakness seen in thermal coal prices in recent months should reverse once demand from major importers recovers, although there is a risk low prices may persist into 2013, changing the industry's supply side dynamics.
The price of thermal coal (5,500 kcal coal at Newcastle Australia on a free-on-board basis) reached a two-year low of USD87 per metric ton in early June 2012, down from USD142/mt in January 2011. Major reasons for this decline include China's economic slowdown and high coal inventory levels, increased production and exports from Indonesia and Australia, and increased exports by US coal producers due to cheap natural gas displacing coal used in US power generation.
Fitch believes that prices can recover from current lows once demand from key importers - China and India - improves, and the supply side adjusts to reflect the price environment. India depends on coal as its major energy source and is increasingly relying on imported coal as it struggles to increase domestic production. Likewise in China, thermal coal fired power represents more than 70% of the country's energy needs; Fitch believes thermal coal demand from China will lift again post sufficient policy easing by the government, and continue rising over the medium-to-long term in line with the country's strong GDP growth outlook, albeit lower than previous years.
The weak pricing environment is exposing the business risks of high-cost coal producers, as coal prices fall near or below the marginal cost of production. Many Australian producers have high cash costs of production; such operators will be significantly affected if prices remain low for an extended period. At the same time, sustained low coal prices can shift buyers from low-rank coal to higher-grade coals and thus negatively affect both demand and realized prices for low-rank coal.
Fitch notes that many large coal producers have contracts in place with both volumes and prices fixed, typically for a period of one year; such contracts can account for a meaningful share of their total revenues - for example around 65% for Adaro Indonesia ('BB+'/Stable) and around 45% PT Indika Energy ('B+'/Positive). These operators would be insulated from a temporary weakening of coal prices to some extent. However, should low prices persist through 2012 and into 2013, it will negatively affect the prices they negotiate for 2013; such negotiations typically take place in Q4 and Q1 of each calendar year.
Should the current low price environment persist into 2013, Fitch expects high-cost producers in Australia and the US to undertake production cuts, and review expansion projects under consideration. Fitch also believes that production expansion plans by low-cost producing countries like Indonesia may be curtailed. Such actions would limit coal production levels (or growth) and help address oversupply.
In rating companies producing commodities, like coal, Fitch takes a through-the-cycle approach to its ratings; this factors in a reasonable level of rating headroom to accommodate weakening of coal prices. Cash cost of production and cash margins over an industry cycle are given a heavy emphasis and factored into the ratings. Hence, Fitch does not expect any immediate negative rating actions on its rated coal producers in the Asia-Pacific region.
Source: Fitch Ratings
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Friday, 22 March 24
INDONESIA APPROVES 922.14 MLN T COAL PRODUCTION QUOTA FOR 2024, ABOVE TARGET - REUTERS
Indonesia has approved coal production quotas totalling 922.14 million metric tons for 2024, Bambang Suswantono, a senior official at the mining mi ...
Friday, 22 March 24
CHINA COAL INDUSTRY GROUP EXPECTS OUTPUT GROWTH TO SLOW IN 2024 - REUTERS
China’s coal output is expected to increase 36 million metric tons, or 0.8%, to about 4.7 billion tonnes in 2024, a Chinese coal industry gro ...
Monday, 18 March 24
THREE KEY TAKEAWAYS FROM OUR EUROPE GAS MARKETS SHORT-TERM OUTLOOK Q1 2024 - WOOD MACKENZIE
European gas prices are currently back to pre-crisis levels, but with a complex series of factors affecting future supply and demand, are they set ...
Wednesday, 06 March 24
INDONESIA AIMS TO FINISH MINING OUTPUT QUOTAS APPROVAL BY END-MARCH, OFFICIAL SAYS - REUTERS
Indonesia’s has approved the mining production quotarequests from more than 120mineral companies and aims to complete the approval process th ...
Monday, 04 March 24
IS YOUR GUARANTEE A GUARANTEE? NOTE TO SHIPOWNERS - GARD
KNOWLEDGE TO ELEVATE
The law of guarantees is not always obvious or easy to understand without proper guidance. This article clarifies the dif ...
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Showing 26 to 30 news of total 6871 |
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- Power Finance Corporation Ltd., India
- Antam Resourcindo - Indonesia
- Vedanta Resources Plc - India
- Deloitte Consulting - India
- Iligan Light & Power Inc, Philippines
- Sical Logistics Limited - India
- Kumho Petrochemical, South Korea
- GMR Energy Limited - India
- Samtan Co., Ltd - South Korea
- Meralco Power Generation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Lanco Infratech Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Semirara Mining and Power Corporation, Philippines
- Bangladesh Power Developement Board
- Anglo American - United Kingdom
- South Luzon Thermal Energy Corporation
- Pipit Mutiara Jaya. PT, Indonesia
- Georgia Ports Authority, United States
- Directorate General of MIneral and Coal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Electricity Authority, New Zealand
- Kohat Cement Company Ltd. - Pakistan
- Bharathi Cement Corporation - India
- Pendopo Energi Batubara - Indonesia
- LBH Netherlands Bv - Netherlands
- Planning Commission, India
- Ambuja Cements Ltd - India
- Sarangani Energy Corporation, Philippines
- Aditya Birla Group - India
- PetroVietnam Power Coal Import and Supply Company
- Eastern Coal Council - USA
- New Zealand Coal & Carbon
- Alfred C Toepfer International GmbH - Germany
- Petrochimia International Co. Ltd.- Taiwan
- Binh Thuan Hamico - Vietnam
- Baramulti Group, Indonesia
- Marubeni Corporation - India
- Globalindo Alam Lestari - Indonesia
- Indika Energy - Indonesia
- Tata Chemicals Ltd - India
- Siam City Cement - Thailand
- Sakthi Sugars Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Gujarat Electricity Regulatory Commission - India
- Ind-Barath Power Infra Limited - India
- Africa Commodities Group - South Africa
- Oldendorff Carriers - Singapore
- Australian Coal Association
- Central Java Power - Indonesia
- Karaikal Port Pvt Ltd - India
- Uttam Galva Steels Limited - India
- India Bulls Power Limited - India
- Coastal Gujarat Power Limited - India
- Videocon Industries ltd - India
- Kideco Jaya Agung - Indonesia
- SN Aboitiz Power Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Global Business Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- TeaM Sual Corporation - Philippines
- Krishnapatnam Port Company Ltd. - India
- Cigading International Bulk Terminal - Indonesia
- Rio Tinto Coal - Australia
- ICICI Bank Limited - India
- Toyota Tsusho Corporation, Japan
- VISA Power Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Singapore Mercantile Exchange
- Port Waratah Coal Services - Australia
- Straits Asia Resources Limited - Singapore
- Vijayanagar Sugar Pvt Ltd - India
- MS Steel International - UAE
- Mercator Lines Limited - India
- CNBM International Corporation - China
- Makarim & Taira - Indonesia
- The University of Queensland
- Bhushan Steel Limited - India
- Sindya Power Generating Company Private Ltd
- Central Electricity Authority - India
- Kapuas Tunggal Persada - Indonesia
- Bukit Baiduri Energy - Indonesia
- Salva Resources Pvt Ltd - India
- Interocean Group of Companies - India
- SMG Consultants - Indonesia
- Minerals Council of Australia
- Thai Mozambique Logistica
- Energy Development Corp, Philippines
- Bhoruka Overseas - Indonesia
- PowerSource Philippines DevCo
- Malabar Cements Ltd - India
- Maheswari Brothers Coal Limited - India
- Ministry of Transport, Egypt
- CIMB Investment Bank - Malaysia
- Indonesian Coal Mining Association
- Wood Mackenzie - Singapore
- Carbofer General Trading SA - India
- ASAPP Information Group - India
- Parliament of New Zealand
- Simpson Spence & Young - Indonesia
- Directorate Of Revenue Intelligence - India
- Australian Commodity Traders Exchange
- Timah Investasi Mineral - Indoneisa
- Jaiprakash Power Ventures ltd
- Ministry of Finance - Indonesia
- Global Coal Blending Company Limited - Australia
- Kalimantan Lumbung Energi - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Miang Besar Coal Terminal - Indonesia
- Siam City Cement PLC, Thailand
- Banpu Public Company Limited - Thailand
- Mjunction Services Limited - India
- Parry Sugars Refinery, India
- Kartika Selabumi Mining - Indonesia
- Kobexindo Tractors - Indoneisa
- Energy Link Ltd, New Zealand
- Savvy Resources Ltd - HongKong
- Aboitiz Power Corporation - Philippines
- Ceylon Electricity Board - Sri Lanka
- Holcim Trading Pte Ltd - Singapore
- SMC Global Power, Philippines
- Billiton Holdings Pty Ltd - Australia
- Tamil Nadu electricity Board
- Asia Pacific Energy Resources Ventures Inc, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Ministry of Mines - Canada
- Kaltim Prima Coal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Posco Energy - South Korea
- Offshore Bulk Terminal Pte Ltd, Singapore
- Attock Cement Pakistan Limited
- Manunggal Multi Energi - Indonesia
- IHS Mccloskey Coal Group - USA
- Sojitz Corporation - Japan
- Borneo Indobara - Indonesia
- Larsen & Toubro Limited - India
- Medco Energi Mining Internasional
- Leighton Contractors Pty Ltd - Australia
- Cement Manufacturers Association - India
- White Energy Company Limited
- Gujarat Mineral Development Corp Ltd - India
- Gujarat Sidhee Cement - India
- Jindal Steel & Power Ltd - India
- Intertek Mineral Services - Indonesia
- Essar Steel Hazira Ltd - India
- Independent Power Producers Association of India
- Coalindo Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Romanian Commodities Exchange
- San Jose City I Power Corp, Philippines
- Indian Oil Corporation Limited
- OPG Power Generation Pvt Ltd - India
- Indian Energy Exchange, India
- Chettinad Cement Corporation Ltd - India
- Wilmar Investment Holdings
- Edison Trading Spa - Italy
- The State Trading Corporation of India Ltd
- Thiess Contractors Indonesia
- Kepco SPC Power Corporation, Philippines
- Renaissance Capital - South Africa
- Rashtriya Ispat Nigam Limited - India
- Price Waterhouse Coopers - Russia
- Indogreen Group - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Agrawal Coal Company - India
- Coal and Oil Company - UAE
- PTC India Limited - India
- Sinarmas Energy and Mining - Indonesia
- The Treasury - Australian Government
- Economic Council, Georgia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Petron Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Mercuria Energy - Indonesia
- Eastern Energy - Thailand
- Chamber of Mines of South Africa
- Bayan Resources Tbk. - Indonesia
- Xindia Steels Limited - India
- Star Paper Mills Limited - India
- Orica Australia Pty. Ltd.
- Vizag Seaport Private Limited - India
- Meenaskhi Energy Private Limited - India
- Maharashtra Electricity Regulatory Commission - India
- McConnell Dowell - Australia
- Bukit Makmur.PT - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Electricity Generating Authority of Thailand
- Asmin Koalindo Tuhup - Indonesia
- Barasentosa Lestari - Indonesia
- Grasim Industreis Ltd - India
- Dalmia Cement Bharat India
- IEA Clean Coal Centre - UK
- Formosa Plastics Group - Taiwan
- Heidelberg Cement - Germany
- Commonwealth Bank - Australia
- Mintek Dendrill Indonesia
- Riau Bara Harum - Indonesia
- European Bulk Services B.V. - Netherlands
- London Commodity Brokers - England
- Trasteel International SA, Italy
- Semirara Mining Corp, Philippines
- Goldman Sachs - Singapore
- Bulk Trading Sa - Switzerland
- Global Green Power PLC Corporation, Philippines
- Bhatia International Limited - India
- GVK Power & Infra Limited - India
- Standard Chartered Bank - UAE
- Latin American Coal - Colombia
- Orica Mining Services - Indonesia
- Madhucon Powers Ltd - India
- Altura Mining Limited, Indonesia
- Metalloyd Limited - United Kingdom
- Jorong Barutama Greston.PT - Indonesia
- GAC Shipping (India) Pvt Ltd
- Merrill Lynch Commodities Europe
- PNOC Exploration Corporation - Philippines
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