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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, 04 February 11
ADARO ENERGY FY10 COAL SALES UP 6 PERCENT TO 43.84 MILLION
As reported by insider stories, Indonesian coal miners PT Adaro Energy Tbk has produced 42.20 million tons of coal in 2010, a 4 percent increase com ...
Thursday, 03 February 11
MERCATOR LINES TO INVEST RS 200-250 CRORE ON COAL MINE IN INDONESIA - ECONOMIC TIMES
Economic Times reported that, Mercator Lines, the HK Mittal-controlled shipping-to-mines major, will invest about 200-250 crore (US$ 43.825 - 54.781 ...
Thursday, 03 February 11
DRY BULK MARKET LOOKS SET TO BOTTOM OUT NIKOS - ROUSSANOGLOU, HELLENIC SHIPPING
With the dry bulk market having lost more than 72% of its value in the last month or so and having retreated to a 2-year low, it seems that the bott ...
Wednesday, 02 February 11
INDONESIA MAY MISS COAL EXPORT TARGET IN 2011
COALspot.com - Indonesian Trade ministry has instructed independent surveyors temporarily not to issue pre-shipment survey report (LS) to the compan ...
Wednesday, 02 February 11
BAYAN TO SUPPLY COAL TO TP UTILITIES LTD
Insider Stories has reportd that, Indonesia's one of the leading coal miner PT Bayan Resources Tbk (BYAN) owned by businessman Dato' Low Tuck ...
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- Minerals Council of Australia
- European Bulk Services B.V. - Netherlands
- Holcim Trading Pte Ltd - Singapore
- Oldendorff Carriers - Singapore
- White Energy Company Limited
- Siam City Cement - Thailand
- Baramulti Group, Indonesia
- Rio Tinto Coal - Australia
- Economic Council, Georgia
- Directorate General of MIneral and Coal - Indonesia
- Coastal Gujarat Power Limited - India
- New Zealand Coal & Carbon
- Global Green Power PLC Corporation, Philippines
- Anglo American - United Kingdom
- Meralco Power Generation, Philippines
- Bhoruka Overseas - Indonesia
- Jaiprakash Power Ventures ltd
- The Treasury - Australian Government
- Indo Tambangraya Megah - Indonesia
- Edison Trading Spa - Italy
- Salva Resources Pvt Ltd - India
- ASAPP Information Group - India
- Ministry of Mines - Canada
- Petron Corporation, Philippines
- Electricity Authority, New Zealand
- LBH Netherlands Bv - Netherlands
- Bukit Baiduri Energy - Indonesia
- Australian Commodity Traders Exchange
- Orica Australia Pty. Ltd.
- Medco Energi Mining Internasional
- SMG Consultants - Indonesia
- Global Business Power Corporation, Philippines
- Goldman Sachs - Singapore
- The University of Queensland
- Sakthi Sugars Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ceylon Electricity Board - Sri Lanka
- Kumho Petrochemical, South Korea
- Interocean Group of Companies - India
- PNOC Exploration Corporation - Philippines
- Carbofer General Trading SA - India
- India Bulls Power Limited - India
- Tata Chemicals Ltd - India
- Antam Resourcindo - Indonesia
- London Commodity Brokers - England
- IEA Clean Coal Centre - UK
- Barasentosa Lestari - Indonesia
- Chamber of Mines of South Africa
- Wilmar Investment Holdings
- Mercuria Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Simpson Spence & Young - Indonesia
- OPG Power Generation Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Thai Mozambique Logistica
- Electricity Generating Authority of Thailand
- GMR Energy Limited - India
- ICICI Bank Limited - India
- SN Aboitiz Power Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Commonwealth Bank - Australia
- Sindya Power Generating Company Private Ltd
- Central Java Power - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Parry Sugars Refinery, India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Energy Link Ltd, New Zealand
- Wood Mackenzie - Singapore
- Merrill Lynch Commodities Europe
- Meenaskhi Energy Private Limited - India
- Heidelberg Cement - Germany
- Ind-Barath Power Infra Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Price Waterhouse Coopers - Russia
- Pendopo Energi Batubara - Indonesia
- Malabar Cements Ltd - India
- Mintek Dendrill Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Madhucon Powers Ltd - India
- Riau Bara Harum - Indonesia
- Ambuja Cements Ltd - India
- Port Waratah Coal Services - Australia
- Indogreen Group - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Bhushan Steel Limited - India
- Coalindo Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Timah Investasi Mineral - Indoneisa
- Thiess Contractors Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Cigading International Bulk Terminal - Indonesia
- Manunggal Multi Energi - Indonesia
- Banpu Public Company Limited - Thailand
- Gujarat Mineral Development Corp Ltd - India
- GVK Power & Infra Limited - India
- CNBM International Corporation - China
- McConnell Dowell - Australia
- Iligan Light & Power Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Kideco Jaya Agung - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Essar Steel Hazira Ltd - India
- Posco Energy - South Korea
- Kohat Cement Company Ltd. - Pakistan
- CIMB Investment Bank - Malaysia
- Latin American Coal - Colombia
- GAC Shipping (India) Pvt Ltd
- Asmin Koalindo Tuhup - Indonesia
- Energy Development Corp, Philippines
- Kobexindo Tractors - Indoneisa
- Mjunction Services Limited - India
- Siam City Cement PLC, Thailand
- Aditya Birla Group - India
- Larsen & Toubro Limited - India
- Rashtriya Ispat Nigam Limited - India
- VISA Power Limited - India
- Gujarat Sidhee Cement - India
- Vizag Seaport Private Limited - India
- Eastern Coal Council - USA
- PTC India Limited - India
- Grasim Industreis Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Tamil Nadu electricity Board
- Semirara Mining Corp, Philippines
- Chettinad Cement Corporation Ltd - India
- Standard Chartered Bank - UAE
- Samtan Co., Ltd - South Korea
- Renaissance Capital - South Africa
- Ministry of Transport, Egypt
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- The State Trading Corporation of India Ltd
- AsiaOL BioFuels Corp., Philippines
- Romanian Commodities Exchange
- Bayan Resources Tbk. - Indonesia
- Jindal Steel & Power Ltd - India
- Deloitte Consulting - India
- Parliament of New Zealand
- Ministry of Finance - Indonesia
- Africa Commodities Group - South Africa
- Sical Logistics Limited - India
- Indian Oil Corporation Limited
- Agrawal Coal Company - India
- Australian Coal Association
- Makarim & Taira - Indonesia
- Power Finance Corporation Ltd., India
- Maheswari Brothers Coal Limited - India
- Toyota Tsusho Corporation, Japan
- Karbindo Abesyapradhi - Indoneisa
- Bulk Trading Sa - Switzerland
- Vedanta Resources Plc - India
- Borneo Indobara - Indonesia
- PowerSource Philippines DevCo
- GN Power Mariveles Coal Plant, Philippines
- Kartika Selabumi Mining - Indonesia
- Videocon Industries ltd - India
- Attock Cement Pakistan Limited
- Sinarmas Energy and Mining - Indonesia
- Coal and Oil Company - UAE
- Georgia Ports Authority, United States
- Therma Luzon, Inc, Philippines
- San Jose City I Power Corp, Philippines
- Indonesian Coal Mining Association
- Eastern Energy - Thailand
- Orica Mining Services - Indonesia
- Trasteel International SA, Italy
- Planning Commission, India
- SMC Global Power, Philippines
- Central Electricity Authority - India
- IHS Mccloskey Coal Group - USA
- Altura Mining Limited, Indonesia
- Metalloyd Limited - United Kingdom
- Bangladesh Power Developement Board
- TNB Fuel Sdn Bhd - Malaysia
- Aboitiz Power Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Dalmia Cement Bharat India
- Global Coal Blending Company Limited - Australia
- Directorate Of Revenue Intelligence - India
- Indian Energy Exchange, India
- Lanco Infratech Ltd - India
- Xindia Steels Limited - India
- Cement Manufacturers Association - India
- Straits Asia Resources Limited - Singapore
- Leighton Contractors Pty Ltd - Australia
- Intertek Mineral Services - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Karaikal Port Pvt Ltd - India
- Mercator Lines Limited - India
- Independent Power Producers Association of India
- Uttam Galva Steels Limited - India
- Formosa Plastics Group - Taiwan
- Star Paper Mills Limited - India
- South Luzon Thermal Energy Corporation
- MS Steel International - UAE
- Bharathi Cement Corporation - India
- Indika Energy - Indonesia
- Marubeni Corporation - India
- Petrochimia International Co. Ltd.- Taiwan
- Globalindo Alam Lestari - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- International Coal Ventures Pvt Ltd - India
- Bhatia International Limited - India
- Kapuas Tunggal Persada - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Billiton Holdings Pty Ltd - Australia
- Jorong Barutama Greston.PT - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Kaltim Prima Coal - Indonesia
- Sree Jayajothi Cements Limited - India
- Singapore Mercantile Exchange
- Sojitz Corporation - Japan
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