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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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Monday, 17 July 23
APPROVED AMMONIA-FUELED CONTAINERSHIP - BENEFITS AND RISKS: REED SMITH
Following the news in Offshore Energy that Korea Maritime Consultants has secured approval in principle from the American Bureau of Shipping for it ...
Friday, 14 July 23
CLEAN COAL USE KEY TO DEEP CUTS IN EMISSIONS, STABLE ELECTRICITY SUPPLY - CHINA DAILY
China must push for the clean use of coal and step up integration of the dirty fuel with carbon capture, utilization and storage to achieve sustain ...
Thursday, 13 July 23
VIETNAM'S COAL EMISSIONS PRIMED FOR SURGE AFTER IMPORTS JUMP - REUTERS
Vietnam’s thermal power emissions are primed for a steep climb this summer after the country’s imports of thermal coal soared to their ...
Monday, 26 June 23
COAL PRODUCTION AND CONSUMPTION UP IN 2022 - EUROSTAT
In 2022, EU coal production and consumption continued to increase, reaching 349 million tonnes (+5% compared with the previous year) and 454 millio ...
Wednesday, 21 June 23
QATAR STRIKES SECOND BIG LNG SUPPLY DEAL WITH CHINA - REUTERS
Qatar on Tuesday secured its second large gas supply deal with a Chinese state-controlled company in less than a year, putting Asia clearly ahead i ...
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- Port Waratah Coal Services - Australia
- Sree Jayajothi Cements Limited - India
- Renaissance Capital - South Africa
- Ministry of Transport, Egypt
- White Energy Company Limited
- Mercator Lines Limited - India
- Bukit Baiduri Energy - Indonesia
- LBH Netherlands Bv - Netherlands
- Minerals Council of Australia
- Bhoruka Overseas - Indonesia
- Mjunction Services Limited - India
- Alfred C Toepfer International GmbH - Germany
- Metalloyd Limited - United Kingdom
- Goldman Sachs - Singapore
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- ASAPP Information Group - India
- Marubeni Corporation - India
- Directorate Of Revenue Intelligence - India
- Kapuas Tunggal Persada - Indonesia
- Sical Logistics Limited - India
- Intertek Mineral Services - Indonesia
- Orica Australia Pty. Ltd.
- Medco Energi Mining Internasional
- Indika Energy - Indonesia
- Toyota Tsusho Corporation, Japan
- Manunggal Multi Energi - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- London Commodity Brokers - England
- Meralco Power Generation, Philippines
- Aditya Birla Group - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Orica Mining Services - Indonesia
- Anglo American - United Kingdom
- Petrochimia International Co. Ltd.- Taiwan
- Electricity Authority, New Zealand
- Sakthi Sugars Limited - India
- Indogreen Group - Indonesia
- Salva Resources Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kartika Selabumi Mining - Indonesia
- Parry Sugars Refinery, India
- Planning Commission, India
- Barasentosa Lestari - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Siam City Cement PLC, Thailand
- Formosa Plastics Group - Taiwan
- Energy Link Ltd, New Zealand
- Georgia Ports Authority, United States
- Independent Power Producers Association of India
- Indian Oil Corporation Limited
- Gujarat Electricity Regulatory Commission - India
- Bayan Resources Tbk. - Indonesia
- Kepco SPC Power Corporation, Philippines
- Lanco Infratech Ltd - India
- IEA Clean Coal Centre - UK
- Riau Bara Harum - Indonesia
- OPG Power Generation Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indonesian Coal Mining Association
- Ambuja Cements Ltd - India
- Deloitte Consulting - India
- Savvy Resources Ltd - HongKong
- CIMB Investment Bank - Malaysia
- VISA Power Limited - India
- European Bulk Services B.V. - Netherlands
- Wilmar Investment Holdings
- Rashtriya Ispat Nigam Limited - India
- Coastal Gujarat Power Limited - India
- Attock Cement Pakistan Limited
- Borneo Indobara - Indonesia
- Carbofer General Trading SA - India
- Ministry of Finance - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bangladesh Power Developement Board
- GVK Power & Infra Limited - India
- Chettinad Cement Corporation Ltd - India
- India Bulls Power Limited - India
- Kideco Jaya Agung - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Tata Chemicals Ltd - India
- TeaM Sual Corporation - Philippines
- Karbindo Abesyapradhi - Indoneisa
- Kumho Petrochemical, South Korea
- Sindya Power Generating Company Private Ltd
- Directorate General of MIneral and Coal - Indonesia
- Interocean Group of Companies - India
- Ministry of Mines - Canada
- Malabar Cements Ltd - India
- Rio Tinto Coal - Australia
- PowerSource Philippines DevCo
- Oldendorff Carriers - Singapore
- The Treasury - Australian Government
- Leighton Contractors Pty Ltd - Australia
- Global Green Power PLC Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Singapore Mercantile Exchange
- Ceylon Electricity Board - Sri Lanka
- Krishnapatnam Port Company Ltd. - India
- ICICI Bank Limited - India
- Straits Asia Resources Limited - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Bharathi Cement Corporation - India
- Cigading International Bulk Terminal - Indonesia
- San Jose City I Power Corp, Philippines
- Posco Energy - South Korea
- Globalindo Alam Lestari - Indonesia
- Bhatia International Limited - India
- Petron Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Price Waterhouse Coopers - Russia
- Billiton Holdings Pty Ltd - Australia
- Power Finance Corporation Ltd., India
- Holcim Trading Pte Ltd - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Grasim Industreis Ltd - India
- Coalindo Energy - Indonesia
- Latin American Coal - Colombia
- Star Paper Mills Limited - India
- SMG Consultants - Indonesia
- Tamil Nadu electricity Board
- Maheswari Brothers Coal Limited - India
- Wood Mackenzie - Singapore
- Commonwealth Bank - Australia
- Larsen & Toubro Limited - India
- Simpson Spence & Young - Indonesia
- Merrill Lynch Commodities Europe
- Sarangani Energy Corporation, Philippines
- Thiess Contractors Indonesia
- Economic Council, Georgia
- Essar Steel Hazira Ltd - India
- South Luzon Thermal Energy Corporation
- Bukit Makmur.PT - Indonesia
- Makarim & Taira - Indonesia
- PTC India Limited - India
- Pendopo Energi Batubara - Indonesia
- Global Coal Blending Company Limited - Australia
- Vizag Seaport Private Limited - India
- SMC Global Power, Philippines
- Meenaskhi Energy Private Limited - India
- Global Business Power Corporation, Philippines
- Africa Commodities Group - South Africa
- SN Aboitiz Power Inc, Philippines
- Videocon Industries ltd - India
- Central Electricity Authority - India
- Bulk Trading Sa - Switzerland
- Vedanta Resources Plc - India
- Neyveli Lignite Corporation Ltd, - India
- Cement Manufacturers Association - India
- Maharashtra Electricity Regulatory Commission - India
- Eastern Energy - Thailand
- Miang Besar Coal Terminal - Indonesia
- Aboitiz Power Corporation - Philippines
- Electricity Generating Authority of Thailand
- Timah Investasi Mineral - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Jindal Steel & Power Ltd - India
- Sinarmas Energy and Mining - Indonesia
- GAC Shipping (India) Pvt Ltd
- IHS Mccloskey Coal Group - USA
- Mercuria Energy - Indonesia
- Bhushan Steel Limited - India
- Baramulti Group, Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- International Coal Ventures Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Standard Chartered Bank - UAE
- Trasteel International SA, Italy
- Semirara Mining and Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- Xindia Steels Limited - India
- Central Java Power - Indonesia
- Madhucon Powers Ltd - India
- Romanian Commodities Exchange
- MS Steel International - UAE
- PNOC Exploration Corporation - Philippines
- GN Power Mariveles Coal Plant, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Binh Thuan Hamico - Vietnam
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Thai Mozambique Logistica
- Heidelberg Cement - Germany
- Energy Development Corp, Philippines
- Gujarat Sidhee Cement - India
- Jaiprakash Power Ventures ltd
- Semirara Mining Corp, Philippines
- Kaltim Prima Coal - Indonesia
- Agrawal Coal Company - India
- Edison Trading Spa - Italy
- Eastern Coal Council - USA
- CNBM International Corporation - China
- GMR Energy Limited - India
- Coal and Oil Company - UAE
- Kobexindo Tractors - Indoneisa
- New Zealand Coal & Carbon
- Indo Tambangraya Megah - Indonesia
- Ind-Barath Power Infra Limited - India
- Australian Commodity Traders Exchange
- Altura Mining Limited, Indonesia
- Mintek Dendrill Indonesia
- Dalmia Cement Bharat India
- Uttam Galva Steels Limited - India
- Parliament of New Zealand
- Asmin Koalindo Tuhup - Indonesia
- Indian Energy Exchange, India
- Australian Coal Association
- Karaikal Port Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- The University of Queensland
- Chamber of Mines of South Africa
- Iligan Light & Power Inc, Philippines
- McConnell Dowell - Australia
- Banpu Public Company Limited - Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Siam City Cement - Thailand
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