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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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Sunday, 10 September 23
CHINA AUGUST COAL IMPORTS OF 44.3 MLN T HIT RECORD - REUTERS
China, the world’s top coal consumer, imported 44.3 million metric tons of the fuel last month, customs data showed, the highest amount in an ...
Tuesday, 22 August 23
CHINA'S COAL PRODUCTION LOGS STEADY GROWTH IN JANUARY-JULY: XINHUA
China’s output of raw coal went up 3.6 percent year on year in the first seven months of this year, official data showed.
The ...
Sunday, 13 August 23
THE COMMODITIES FEED: LNG SUPPLY RISKS LINGER - ING
Energy – OPEC sees deficit over remainder of 2023
Oil prices came under some pressure yesterday with ICE Brent settling a litt ...
Wednesday, 09 August 23
COAL TRADE TO RETURN TO 2019 LEVELS - BALTIC EXCHANGE
The International Energy Agency’s mid-year Coal Market Update for 2023 brings both positive and concerning news for the global coal industry. ...
Sunday, 23 July 23
ANALYSIS-INDIA'S COAL MINING BET STUMBLES AS WARY BANKS WEIGH RISING RISKS - REUTERS
India’s drive to ramp up coal output to meet growing energy demand is faltering due to banks’ reluctance to finance newly auctioned min ...
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- Coalindo Energy - Indonesia
- Samtan Co., Ltd - South Korea
- Tata Chemicals Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Mercator Lines Limited - India
- Ministry of Transport, Egypt
- Globalindo Alam Lestari - Indonesia
- Port Waratah Coal Services - Australia
- Therma Luzon, Inc, Philippines
- Savvy Resources Ltd - HongKong
- TeaM Sual Corporation - Philippines
- Edison Trading Spa - Italy
- Siam City Cement - Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Bayan Resources Tbk. - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Vizag Seaport Private Limited - India
- Dalmia Cement Bharat India
- Bhushan Steel Limited - India
- Metalloyd Limited - United Kingdom
- Electricity Authority, New Zealand
- Gujarat Sidhee Cement - India
- Electricity Generating Authority of Thailand
- Kapuas Tunggal Persada - Indonesia
- Jaiprakash Power Ventures ltd
- Standard Chartered Bank - UAE
- GAC Shipping (India) Pvt Ltd
- Indo Tambangraya Megah - Indonesia
- The Treasury - Australian Government
- Agrawal Coal Company - India
- Sakthi Sugars Limited - India
- Eastern Energy - Thailand
- SMC Global Power, Philippines
- Merrill Lynch Commodities Europe
- SN Aboitiz Power Inc, Philippines
- Kepco SPC Power Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Mintek Dendrill Indonesia
- MS Steel International - UAE
- Georgia Ports Authority, United States
- Barasentosa Lestari - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Carbofer General Trading SA - India
- White Energy Company Limited
- Rio Tinto Coal - Australia
- The University of Queensland
- Vedanta Resources Plc - India
- Latin American Coal - Colombia
- Altura Mining Limited, Indonesia
- Riau Bara Harum - Indonesia
- Larsen & Toubro Limited - India
- Mercuria Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Indian Energy Exchange, India
- PTC India Limited - India
- Chamber of Mines of South Africa
- Wood Mackenzie - Singapore
- Marubeni Corporation - India
- Orica Mining Services - Indonesia
- IEA Clean Coal Centre - UK
- Formosa Plastics Group - Taiwan
- Simpson Spence & Young - Indonesia
- Xindia Steels Limited - India
- Videocon Industries ltd - India
- Holcim Trading Pte Ltd - Singapore
- Toyota Tsusho Corporation, Japan
- IHS Mccloskey Coal Group - USA
- Parliament of New Zealand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Petrochimia International Co. Ltd.- Taiwan
- LBH Netherlands Bv - Netherlands
- Heidelberg Cement - Germany
- European Bulk Services B.V. - Netherlands
- Indian Oil Corporation Limited
- ICICI Bank Limited - India
- Global Business Power Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Sree Jayajothi Cements Limited - India
- Madhucon Powers Ltd - India
- Chettinad Cement Corporation Ltd - India
- Aboitiz Power Corporation - Philippines
- Manunggal Multi Energi - Indonesia
- Planning Commission, India
- Malabar Cements Ltd - India
- Anglo American - United Kingdom
- Gujarat Electricity Regulatory Commission - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Deloitte Consulting - India
- Intertek Mineral Services - Indonesia
- Posco Energy - South Korea
- Bank of Tokyo Mitsubishi UFJ Ltd
- Makarim & Taira - Indonesia
- PNOC Exploration Corporation - Philippines
- GVK Power & Infra Limited - India
- Kalimantan Lumbung Energi - Indonesia
- ASAPP Information Group - India
- Neyveli Lignite Corporation Ltd, - India
- Indika Energy - Indonesia
- Cement Manufacturers Association - India
- Coal and Oil Company - UAE
- Straits Asia Resources Limited - Singapore
- Commonwealth Bank - Australia
- Wilmar Investment Holdings
- Karaikal Port Pvt Ltd - India
- Grasim Industreis Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Jindal Steel & Power Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Interocean Group of Companies - India
- South Luzon Thermal Energy Corporation
- Siam City Cement PLC, Thailand
- Economic Council, Georgia
- Kobexindo Tractors - Indoneisa
- Global Coal Blending Company Limited - Australia
- Bangladesh Power Developement Board
- Energy Development Corp, Philippines
- Ceylon Electricity Board - Sri Lanka
- The State Trading Corporation of India Ltd
- PowerSource Philippines DevCo
- Orica Australia Pty. Ltd.
- Aditya Birla Group - India
- Ministry of Finance - Indonesia
- Meenaskhi Energy Private Limited - India
- Sarangani Energy Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Tamil Nadu electricity Board
- Uttam Galva Steels Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Pendopo Energi Batubara - Indonesia
- Central Electricity Authority - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- London Commodity Brokers - England
- Goldman Sachs - Singapore
- Romanian Commodities Exchange
- Bhatia International Limited - India
- Bulk Trading Sa - Switzerland
- Renaissance Capital - South Africa
- Pipit Mutiara Jaya. PT, Indonesia
- Kideco Jaya Agung - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Australian Commodity Traders Exchange
- Kaltim Prima Coal - Indonesia
- Minerals Council of Australia
- Bukit Baiduri Energy - Indonesia
- CIMB Investment Bank - Malaysia
- Salva Resources Pvt Ltd - India
- Thiess Contractors Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- GMR Energy Limited - India
- India Bulls Power Limited - India
- Ind-Barath Power Infra Limited - India
- Attock Cement Pakistan Limited
- SMG Consultants - Indonesia
- Baramulti Group, Indonesia
- Oldendorff Carriers - Singapore
- Ambuja Cements Ltd - India
- Borneo Indobara - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Antam Resourcindo - Indonesia
- VISA Power Limited - India
- CNBM International Corporation - China
- Directorate Of Revenue Intelligence - India
- Bhoruka Overseas - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Bharathi Cement Corporation - India
- International Coal Ventures Pvt Ltd - India
- Central Java Power - Indonesia
- Indonesian Coal Mining Association
- Singapore Mercantile Exchange
- Parry Sugars Refinery, India
- Thai Mozambique Logistica
- Timah Investasi Mineral - Indoneisa
- Vijayanagar Sugar Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Energy Link Ltd, New Zealand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- McConnell Dowell - Australia
- Sojitz Corporation - Japan
- Price Waterhouse Coopers - Russia
- Directorate General of MIneral and Coal - Indonesia
- Power Finance Corporation Ltd., India
- Eastern Coal Council - USA
- Binh Thuan Hamico - Vietnam
- Sical Logistics Limited - India
- Maheswari Brothers Coal Limited - India
- Ministry of Mines - Canada
- Sinarmas Energy and Mining - Indonesia
- Sindya Power Generating Company Private Ltd
- Leighton Contractors Pty Ltd - Australia
- Semirara Mining and Power Corporation, Philippines
- New Zealand Coal & Carbon
- Semirara Mining Corp, Philippines
- San Jose City I Power Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Medco Energi Mining Internasional
- Petron Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Lanco Infratech Ltd - India
- Star Paper Mills Limited - India
- Banpu Public Company Limited - Thailand
- Independent Power Producers Association of India
- Iligan Light & Power Inc, Philippines
- Essar Steel Hazira Ltd - India
- Global Green Power PLC Corporation, Philippines
- Mjunction Services Limited - India
- Coastal Gujarat Power Limited - India
- Africa Commodities Group - South Africa
- Trasteel International SA, Italy
- Meralco Power Generation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Kumho Petrochemical, South Korea
- Australian Coal Association
- Indogreen Group - Indonesia
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