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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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Tuesday, 08 February 11
PUSTAKA JAYA PALU POWER LOOKING FOR 5800 GAD COAL
COALspot.com - According to market information, PT Pustaka Jaya Palu Power, a power plant operator of the Mpanau plant, Palu, Sulawesi has invited c ...
Tuesday, 08 February 11
BAYAN, KANGAROO EXTEND DUE DILIGENCE
Coal miner controlled by businessman Dato' Low Tuck Kwong PT Bayan Resources Tbk (BYAN) and Australia-listed coal company Kangaroo Resources Limite ...
Tuesday, 08 February 11
DRY BULK: IS THE TIDE TURNING? - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
In what could be perceived as a change of market sentiment for the better, the dry bulk industry’s benchmark, the Baltic Dry Index (BDI) poste ...
Monday, 07 February 11
THE INDONESIAN COAL REFERENCE PRICE HAS JUMPED 13.03 PERCENT IN FEBRUARY 2011
COALspot.com - Indonesia’s Ministry of Energy and Mineral Resources has set the February 2011 Indonesian Coal Reference Price for therma ...
Monday, 07 February 11
RICHARDS BAY COAL TERMINAL EXPORTS SURGE, BUOYED BY ECONOMIC DEVELOPMENT IN CHINA AND INDIA
COALspot.com - Richards Bay Coal Terminal (RBCT) announced today that 2010 exports have exceeded the last two years’ performance, said in a re ...
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- Essar Steel Hazira Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Ministry of Finance - Indonesia
- Pendopo Energi Batubara - Indonesia
- Planning Commission, India
- Cement Manufacturers Association - India
- San Jose City I Power Corp, Philippines
- CIMB Investment Bank - Malaysia
- Bukit Baiduri Energy - Indonesia
- Eastern Coal Council - USA
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sical Logistics Limited - India
- Price Waterhouse Coopers - Russia
- PNOC Exploration Corporation - Philippines
- Kaltim Prima Coal - Indonesia
- Indika Energy - Indonesia
- Coalindo Energy - Indonesia
- Renaissance Capital - South Africa
- Karbindo Abesyapradhi - Indoneisa
- PowerSource Philippines DevCo
- Tata Chemicals Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Coastal Gujarat Power Limited - India
- Gujarat Sidhee Cement - India
- Indian Energy Exchange, India
- Latin American Coal - Colombia
- Jorong Barutama Greston.PT - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Miang Besar Coal Terminal - Indonesia
- Global Green Power PLC Corporation, Philippines
- The Treasury - Australian Government
- Timah Investasi Mineral - Indoneisa
- Kepco SPC Power Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Power Finance Corporation Ltd., India
- Bayan Resources Tbk. - Indonesia
- IHS Mccloskey Coal Group - USA
- Bank of Tokyo Mitsubishi UFJ Ltd
- South Luzon Thermal Energy Corporation
- Australian Coal Association
- Chamber of Mines of South Africa
- Kobexindo Tractors - Indoneisa
- Siam City Cement - Thailand
- VISA Power Limited - India
- Chettinad Cement Corporation Ltd - India
- Energy Link Ltd, New Zealand
- Indogreen Group - Indonesia
- Orica Mining Services - Indonesia
- Wood Mackenzie - Singapore
- Attock Cement Pakistan Limited
- Petron Corporation, Philippines
- Mjunction Services Limited - India
- New Zealand Coal & Carbon
- Altura Mining Limited, Indonesia
- Straits Asia Resources Limited - Singapore
- GAC Shipping (India) Pvt Ltd
- Ambuja Cements Ltd - India
- Economic Council, Georgia
- Indian Oil Corporation Limited
- Thiess Contractors Indonesia
- Orica Australia Pty. Ltd.
- Meenaskhi Energy Private Limited - India
- Sakthi Sugars Limited - India
- Aditya Birla Group - India
- CNBM International Corporation - China
- White Energy Company Limited
- Heidelberg Cement - Germany
- The University of Queensland
- Minerals Council of Australia
- GN Power Mariveles Coal Plant, Philippines
- Cigading International Bulk Terminal - Indonesia
- OPG Power Generation Pvt Ltd - India
- Bulk Trading Sa - Switzerland
- Interocean Group of Companies - India
- Africa Commodities Group - South Africa
- Toyota Tsusho Corporation, Japan
- Commonwealth Bank - Australia
- McConnell Dowell - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Larsen & Toubro Limited - India
- Medco Energi Mining Internasional
- Riau Bara Harum - Indonesia
- Sree Jayajothi Cements Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Siam City Cement PLC, Thailand
- Bangladesh Power Developement Board
- GMR Energy Limited - India
- Georgia Ports Authority, United States
- Directorate General of MIneral and Coal - Indonesia
- Semirara Mining Corp, Philippines
- Therma Luzon, Inc, Philippines
- Bhatia International Limited - India
- Savvy Resources Ltd - HongKong
- Jindal Steel & Power Ltd - India
- Ind-Barath Power Infra Limited - India
- Sojitz Corporation - Japan
- Sarangani Energy Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Australian Commodity Traders Exchange
- Mercator Lines Limited - India
- Borneo Indobara - Indonesia
- Lanco Infratech Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Bharathi Cement Corporation - India
- GVK Power & Infra Limited - India
- Parliament of New Zealand
- Sinarmas Energy and Mining - Indonesia
- IEA Clean Coal Centre - UK
- Carbofer General Trading SA - India
- LBH Netherlands Bv - Netherlands
- Meralco Power Generation, Philippines
- Baramulti Group, Indonesia
- London Commodity Brokers - England
- Indo Tambangraya Megah - Indonesia
- Parry Sugars Refinery, India
- Asmin Koalindo Tuhup - Indonesia
- India Bulls Power Limited - India
- Bhoruka Overseas - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Kideco Jaya Agung - Indonesia
- Deloitte Consulting - India
- Merrill Lynch Commodities Europe
- Electricity Generating Authority of Thailand
- Central Java Power - Indonesia
- Sindya Power Generating Company Private Ltd
- Coal and Oil Company - UAE
- Trasteel International SA, Italy
- Marubeni Corporation - India
- Grasim Industreis Ltd - India
- Rio Tinto Coal - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Electricity Authority, New Zealand
- Wilmar Investment Holdings
- Gujarat Electricity Regulatory Commission - India
- Aboitiz Power Corporation - Philippines
- Edison Trading Spa - Italy
- Antam Resourcindo - Indonesia
- International Coal Ventures Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Makarim & Taira - Indonesia
- Mintek Dendrill Indonesia
- Goldman Sachs - Singapore
- ICICI Bank Limited - India
- Xindia Steels Limited - India
- Binh Thuan Hamico - Vietnam
- Jaiprakash Power Ventures ltd
- The State Trading Corporation of India Ltd
- Dalmia Cement Bharat India
- Star Paper Mills Limited - India
- Videocon Industries ltd - India
- ASAPP Information Group - India
- Petrochimia International Co. Ltd.- Taiwan
- Vizag Seaport Private Limited - India
- Ministry of Mines - Canada
- Global Business Power Corporation, Philippines
- Bhushan Steel Limited - India
- SMG Consultants - Indonesia
- Thai Mozambique Logistica
- Indonesian Coal Mining Association
- Salva Resources Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Global Coal Blending Company Limited - Australia
- Energy Development Corp, Philippines
- Holcim Trading Pte Ltd - Singapore
- PTC India Limited - India
- TeaM Sual Corporation - Philippines
- Oldendorff Carriers - Singapore
- Intertek Mineral Services - Indonesia
- Simpson Spence & Young - Indonesia
- Standard Chartered Bank - UAE
- Kohat Cement Company Ltd. - Pakistan
- Kumho Petrochemical, South Korea
- SMC Global Power, Philippines
- European Bulk Services B.V. - Netherlands
- Romanian Commodities Exchange
- Vedanta Resources Plc - India
- Metalloyd Limited - United Kingdom
- Kapuas Tunggal Persada - Indonesia
- Banpu Public Company Limited - Thailand
- Malabar Cements Ltd - India
- Central Electricity Authority - India
- Neyveli Lignite Corporation Ltd, - India
- Agrawal Coal Company - India
- Port Waratah Coal Services - Australia
- Kalimantan Lumbung Energi - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Formosa Plastics Group - Taiwan
- Posco Energy - South Korea
- Anglo American - United Kingdom
- TNB Fuel Sdn Bhd - Malaysia
- Directorate Of Revenue Intelligence - India
- Maheswari Brothers Coal Limited - India
- Iligan Light & Power Inc, Philippines
- Singapore Mercantile Exchange
- Independent Power Producers Association of India
- Karaikal Port Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Ministry of Transport, Egypt
- Barasentosa Lestari - Indonesia
- Manunggal Multi Energi - Indonesia
- Tamil Nadu electricity Board
- Bukit Makmur.PT - Indonesia
- Eastern Energy - Thailand
- Samtan Co., Ltd - South Korea
- Mercuria Energy - Indonesia
- Madhucon Powers Ltd - India
- MS Steel International - UAE
- Semirara Mining and Power Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Gujarat Mineral Development Corp Ltd - India
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