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Monday, 07 February 11
COAL PRICES ON RISE: DEMAND FROM INDIA AND CHINA - ANALYZED SUNIL K KUMBHAT
 INDONESIA IS HEART OF ASIAN COAL BOOM
COALspot.com - Rising demand of Coal from India and China, coupled with global financial recovery, is driving thermal coal prices that have appreciated in the recent past few months and it is expected that the global prices of Coal shall remain firm and go up further.
Power generation is what is driving the demand of Coal in India and China . In India new coal-fired power plants, ranging in the size from 50 MW to 4,000 MW, are being built throughout India. Power plants are symbol of how rapidly India's economy is expanding.
Similarly China, shall remain a net importer of thermal coal for coming few years as it's economy is growing at firm speed and is expected to deliver mind-boggling growth in 2011. China's coal imports more than doubled to 150 million tonnes from the previous year. Closure of smaller mines, coupled with increased demand from power sector, has triggered China's demand for imported coal.
India has also emerged as one of the major importer of coal. The imports are likely to be around 100-150 million tonnes for the current year as it adds new thermal capacities. India imports about three-fourths of its coal requirement from Indonesia, while South Africa and Australia accounts for the rest.
The quality of Indonesian coal is much better than Indian coal. The gross calorific value of Indonesian coal ranges between 5,000 and 6,500 kilo calories per kilogram (kcl/kg); while for Indian coal it is only 3,000-4,500 kcl/kg- with high ash contents. Bulk of the imported coal in India is used by power companies, which use it to blend with the local coal to improve calorific value. The coal prices also depend upon the ash content and the calorific value .Indonesia’s strategic geographic location makes it the most preferred country for Indian companies for its proximity to the country, which means lower ocean freight charges and better timing compared to other countries such as Australia.
Indonesia's coal Industry has transformed itself from being an minor player in Asia's Coal market to the world's largest Exporter of Steam Coal .Indonesia has come from nowhere to challenge Australia as the world’s largest exporter of thermal coal and is expected soon to topple Australia as the largest coal exporter.
The higher energy demand in India would drive up import of coal .The overall energy generated in India could double within a decade.
Indian power sector will be heavily depend on coal for decades to come. At the same time, India's steel industry, also dependent on coal, is expected to treble its output within a decade.
But there is growing concern about where all the coal is going to come from. India has significant coal reserves suitable for power generation and boasts the world's biggest coal company - the government-owned Coal India Limited. But the expansion of the Indian economy has been so rapid, demand is outstripping domestic supply.
The government wants the economy to expand at 9-10 per cent a year to help lift millions of poor families out of poverty. But an energy supply crunch could compromise that growth target.
India has theoretically significant reserves but it will take a long time to get into actual production, There is a urgent need to re-examine the regulations and policies associated with exploration, exploitation and production. India is still not fully encouraging commercial coal mining by the private sector.
India's coal reserves are concentrated in the eastern states of Orissa, Jharkhand, Chhattisgarh, West Bengal and Madhya Pradesh, where basic logistics infrastructure (such as ports and railways) is lacking. Various government regulation concerning forestry and environmental restrictions are also hindering mine development. Unless such bottlenecks are addressed, growth in domestic coal production could be difficult.'
Due to government regulatory delays, infrastructure bottlenecks and security risks are encouraging Indian firms to look overseas to secure coal supply especially in Indonesia, South Africa, Mozambique, Australia etc. for their ambitious power projects in India.
Indonesia's thermal coal mines have a comparative advantage over Australia's because they are nearer to India but Australia's reputation as a reliable supplier is attractive to Indian buyers.’ Australian mines might be more expensive but they are reliable. Australia’s advantages are that the coal is good and the infrastructure is good'
In spit of all , Australia will face stiff competition from Indonesia - which has lower transport costs. A significant proportion of coal transport in Indonesia is water based, which allows for coal to be transported along rivers via barges to the open sea for loading onto larger vessels. Indonesia’s coal suppliers rely heavily on floating transhipment facilities due to economic reasons.
Indonesia's coal Industry has transformed itself from being an minor player in Asia's Coal market to the world's largest Exporter of Steam Coal .Indonesia has come from nowhere to challenge Australia as the world’s largest exporter of thermal coal and is expected soon to topple Australia as the largest coal exporter.
Indonesia’s government needs to accelerate reforms for foreign direct investment (FDI) in mining and energy sector to give direct control to foreign investors, in order to win confidence and attract/invite major international companies into Indonesia. There is need of more coordination between Ministry of Energy and Mineral Resources Deptt , Indonesian Investment Co-ordination Board (BKPM) ,and Various Regional administrations.
The phenomenal growth in Indonesia’s coal exports in last five years reflects the ability of its coal industry to respond to the rapid growth in Asian demand for thermal coal.
Indonesia has huge coal reserves and exporting coal to many countries for use in power plants for generating energy but it is paradoxical that Indonesia is short of energy. Many Indian companies (Tata , Reliance,Jindal ,L&T, Monnet, Adani ,Essar etc) are capable of sharing power technology and setting up mega power plants in Indonesia
Indonesian private companies can buy equity stakes in Indian power plants in exchange / barter for long-term coal supply. Since India is today one of the fastest growing economies and also has a shortage of power supply then such deals can be beneficial to both parties .Indonesian government or Indonesian companies can invite Coal barter bids (CBB) ,where from foreign companies for development of ports , Roads , Railway lines , Power Plants etc. In Coal barter bids , coal will be supplied to party who will set up Power plants or develop infrastructure etc. Coal mining in Indonesia can be an extremely lucrative sector for overall economic growth. Indonesian government should make single window clearance system to operate business in Indonesia to encourage foreign enterprises and Investment for Coal barter bids. Indonesian Coal companies are fully aware that India is a market into which they can export or thru barter transactions, its major share of Coal Production.
Today Indonesia has stable economic outlook and if reform efforts towards basic infrastructures continues it may become Economic Tiger of Asia by 2020.
Today Indonesia is the heart of the Asian Coal boom.
Analyst - Sunil K Kumbhat , Jodhpur (Rajasthan), India
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Friday, 11 February 11
DRY BULK MARKET HEATING UP ON FRESH CARGO DEMAND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market is on a high this week, with owners of smaller vessels turning their attention towards the spot market, in order to take advanta ...
Thursday, 10 February 11
SUPRA RATES IMPROVED A LITTLE OVER US$ 6K BSS N. CHINA DELIVERY FOR INDO-INDIA AND THAILAND ROUNDS - FEARNBULK
Handy
Atl is still weak with little fresh enquiry and an accumulation of spot tonnage.Owners are reluctant to send tonnage thru Suez due to uncert ...
Thursday, 10 February 11
BUKIT ASAM EXPECTS ABOVE RP 3 TRIO PROFIT
The state-owned coal miner PT Tambang Bukit Asam Tbk (PTBA) expects to reach 2011's net profit above Rp 3 trillion (US$ 336,322,568) from above Rp2 ...
Wednesday, 09 February 11
INDONESIA ALLOWED 60 COAL TRADING COMPANIES TO EXPORT COAL
COALspot.com - A temporary ban imposed on coal traders in January has lifted this week. As of today 60coal trading companies were allowed to resume ...
Tuesday, 08 February 11
INDIA'S SIMHAPURU TARGETS S.AFRICAN COAL - ECONOMIC TIMES
Economic Times reported that, India's Simhapuri Energy , a unit of the Madhucon Group , wants to buy new or existing collieries in South Africa fro ...
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- Power Finance Corporation Ltd., India
- Chamber of Mines of South Africa
- Jorong Barutama Greston.PT - Indonesia
- TeaM Sual Corporation - Philippines
- Asmin Koalindo Tuhup - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Bhatia International Limited - India
- CIMB Investment Bank - Malaysia
- LBH Netherlands Bv - Netherlands
- Edison Trading Spa - Italy
- Semirara Mining and Power Corporation, Philippines
- Altura Mining Limited, Indonesia
- Mjunction Services Limited - India
- OPG Power Generation Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Borneo Indobara - Indonesia
- Port Waratah Coal Services - Australia
- Timah Investasi Mineral - Indoneisa
- Kaltim Prima Coal - Indonesia
- Indian Oil Corporation Limited
- Madhucon Powers Ltd - India
- Singapore Mercantile Exchange
- Mintek Dendrill Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Directorate Of Revenue Intelligence - India
- New Zealand Coal & Carbon
- Kepco SPC Power Corporation, Philippines
- Deloitte Consulting - India
- Indo Tambangraya Megah - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Global Green Power PLC Corporation, Philippines
- Jaiprakash Power Ventures ltd
- Malabar Cements Ltd - India
- Manunggal Multi Energi - Indonesia
- Sojitz Corporation - Japan
- IEA Clean Coal Centre - UK
- Ministry of Finance - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Energy Link Ltd, New Zealand
- Wilmar Investment Holdings
- European Bulk Services B.V. - Netherlands
- Larsen & Toubro Limited - India
- Sakthi Sugars Limited - India
- Thiess Contractors Indonesia
- Savvy Resources Ltd - HongKong
- Kapuas Tunggal Persada - Indonesia
- India Bulls Power Limited - India
- Grasim Industreis Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Bhushan Steel Limited - India
- The University of Queensland
- Alfred C Toepfer International GmbH - Germany
- Xindia Steels Limited - India
- MS Steel International - UAE
- Planning Commission, India
- Sindya Power Generating Company Private Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Orica Australia Pty. Ltd.
- San Jose City I Power Corp, Philippines
- Gujarat Sidhee Cement - India
- Rashtriya Ispat Nigam Limited - India
- Interocean Group of Companies - India
- Pipit Mutiara Jaya. PT, Indonesia
- Sinarmas Energy and Mining - Indonesia
- Posco Energy - South Korea
- Coalindo Energy - Indonesia
- White Energy Company Limited
- Billiton Holdings Pty Ltd - Australia
- The Treasury - Australian Government
- Maharashtra Electricity Regulatory Commission - India
- Baramulti Group, Indonesia
- ICICI Bank Limited - India
- SMC Global Power, Philippines
- Coal and Oil Company - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Intertek Mineral Services - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Sarangani Energy Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Carbofer General Trading SA - India
- Commonwealth Bank - Australia
- Bayan Resources Tbk. - Indonesia
- Renaissance Capital - South Africa
- PetroVietnam Power Coal Import and Supply Company
- Dalmia Cement Bharat India
- Medco Energi Mining Internasional
- Pendopo Energi Batubara - Indonesia
- Indian Energy Exchange, India
- Globalindo Alam Lestari - Indonesia
- Central Java Power - Indonesia
- Mercuria Energy - Indonesia
- Kumho Petrochemical, South Korea
- Siam City Cement - Thailand
- IHS Mccloskey Coal Group - USA
- Karbindo Abesyapradhi - Indoneisa
- Cigading International Bulk Terminal - Indonesia
- Central Electricity Authority - India
- Indika Energy - Indonesia
- SMG Consultants - Indonesia
- International Coal Ventures Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- GVK Power & Infra Limited - India
- Standard Chartered Bank - UAE
- Samtan Co., Ltd - South Korea
- Banpu Public Company Limited - Thailand
- Latin American Coal - Colombia
- Ambuja Cements Ltd - India
- Ind-Barath Power Infra Limited - India
- Vizag Seaport Private Limited - India
- Tata Chemicals Ltd - India
- Indogreen Group - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Mercator Lines Limited - India
- Cement Manufacturers Association - India
- Bulk Trading Sa - Switzerland
- Essar Steel Hazira Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Merrill Lynch Commodities Europe
- Bangladesh Power Developement Board
- Thai Mozambique Logistica
- McConnell Dowell - Australia
- Leighton Contractors Pty Ltd - Australia
- Energy Development Corp, Philippines
- Toyota Tsusho Corporation, Japan
- Semirara Mining Corp, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Ministry of Mines - Canada
- Bukit Makmur.PT - Indonesia
- Rio Tinto Coal - Australia
- ASAPP Information Group - India
- Therma Luzon, Inc, Philippines
- Electricity Generating Authority of Thailand
- Wood Mackenzie - Singapore
- Makarim & Taira - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Australian Coal Association
- Maheswari Brothers Coal Limited - India
- Lanco Infratech Ltd - India
- The State Trading Corporation of India Ltd
- Heidelberg Cement - Germany
- Electricity Authority, New Zealand
- Simpson Spence & Young - Indonesia
- Economic Council, Georgia
- Directorate General of MIneral and Coal - Indonesia
- Meenaskhi Energy Private Limited - India
- Agrawal Coal Company - India
- Vedanta Resources Plc - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Jindal Steel & Power Ltd - India
- Siam City Cement PLC, Thailand
- PTC India Limited - India
- Binh Thuan Hamico - Vietnam
- Bharathi Cement Corporation - India
- Aditya Birla Group - India
- Trasteel International SA, Italy
- Kartika Selabumi Mining - Indonesia
- Attock Cement Pakistan Limited
- TNB Fuel Sdn Bhd - Malaysia
- Australian Commodity Traders Exchange
- Barasentosa Lestari - Indonesia
- Iligan Light & Power Inc, Philippines
- Formosa Plastics Group - Taiwan
- Petron Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- London Commodity Brokers - England
- South Luzon Thermal Energy Corporation
- Price Waterhouse Coopers - Russia
- Eastern Coal Council - USA
- Marubeni Corporation - India
- Bukit Baiduri Energy - Indonesia
- Karaikal Port Pvt Ltd - India
- Videocon Industries ltd - India
- Ministry of Transport, Egypt
- Global Coal Blending Company Limited - Australia
- Goldman Sachs - Singapore
- Metalloyd Limited - United Kingdom
- Neyveli Lignite Corporation Ltd, - India
- Coastal Gujarat Power Limited - India
- Bhoruka Overseas - Indonesia
- PNOC Exploration Corporation - Philippines
- Global Business Power Corporation, Philippines
- Star Paper Mills Limited - India
- Eastern Energy - Thailand
- Uttam Galva Steels Limited - India
- Meralco Power Generation, Philippines
- Tamil Nadu electricity Board
- Indonesian Coal Mining Association
- GMR Energy Limited - India
- Orica Mining Services - Indonesia
- Romanian Commodities Exchange
- Parry Sugars Refinery, India
- Georgia Ports Authority, United States
- Riau Bara Harum - Indonesia
- Independent Power Producers Association of India
- CNBM International Corporation - China
- Kideco Jaya Agung - Indonesia
- PowerSource Philippines DevCo
- Bank of Tokyo Mitsubishi UFJ Ltd
- Anglo American - United Kingdom
- Straits Asia Resources Limited - Singapore
- Sree Jayajothi Cements Limited - India
- Minerals Council of Australia
- GAC Shipping (India) Pvt Ltd
- Aboitiz Power Corporation - Philippines
- Parliament of New Zealand
- VISA Power Limited - India
- Africa Commodities Group - South Africa
- Antam Resourcindo - Indonesia
- Sical Logistics Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Oldendorff Carriers - Singapore
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