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Wednesday, 19 October 11
METALLURGICAL COAL PRICES TO DROP BELOW US$240/TONNE - WOOD MACKENZIE
 Wood Mackenzie Says Metallurgical Coal Prices to Drop Below US$240/tonne by Q4 2012 But Long-term Demand Fundamentals Remain Robust
Wood Mackenzie’s Near-Term Market Outlook cautions of falling metallurgical coal prices from now to Q4 2012, dropping from the current quarterly price of US$285/tonne for premium hard coking coal to under US$240/tonne. However, this price remains significantly above the marginal cost of production and longer-term drivers point to robust metallurgical coal demand in the Asia-Pacific market.
Prakash Sharma, Coal Market Analyst says, “Prices have started to fall from the last quarter and will continue to decline due to softening demand and the recovery of supply from flood-hit basins earlier in the year. The weakening demand is largely attributed to the global macroeconomic slowdown which appears to have accelerated through the summer in much of the developed world. Leading industrial indicators suggest a sharp deterioration in manufacturing activity – reflected by the decline in global steel production.”
Wood Mackenzie’s Senior Economist, Ed Rawle says, “The global economy has entered a period of extreme uncertainty. Wood Mackenzie’s global Gross Domestic Product growth forecast has been revised down from 3.1% to 2.8% in 2011, and 3.7% to 3.6% in 2012. But there are significant downside risks to this outlook. The Eurozone debt crisis remains unresolved and threatens to trigger a European banking crisis. Due to the sheer scale of the European banking sector, this is of major concern since it would likely lead to a global banking crisis with implications for us all.”
Despite near-term downward price movements, Wood Mackenzie says that several factors have the potential to turn this trend. Firstly, some mines have not fully recovered from the 2011 Queensland floods. The approaching wet season could lead to further delays in some mines attaining full production levels. Secondly, persistent worker-strikes at BHP Billiton Mitsubishi Alliance operated mines have the ability to tighten the market as these operations produce 26% of globally traded metallurgical coal. Lastly, US low-volatility supply has been curtailed by mine outages and changes in blending techniques following various mergers.
In the long-term , investors are still energized by the coking coal space with high margins in a current supply-constrained world. Mr. Sharma explains, ”Strong long-term demand is likely to support Mergers & Acquisitions (M&A) activity that has been ongoing since early 2008. Demand growth will be led by emerging markets with Asia accounting for 75% of global metallurgical coal demand by 2030. China and India will be key demand drivers, contributing to 60% of Asia Pacific’s total import demand.”
The growth potential of China and India can be attributed to their economic climate relative to the rest of the world. Mr. Rawle says, “The bright spot amidst the uncertainty continues to be the developing world. Specifically, we see China and much of Asia powering ahead, drawing on growth drivers that have been deliberately de-coupled from troubled developed economies over the past couple of years.”
Wood Mackenzie says that China’s reliance on coking coal imports will increase due to insufficient supply of high quality coking coal in the domestic market. China is forging ahead with plans to close all blast furnaces under 1,000 cubic metres and install new blast furnaces with capacities in excess of 2,000 cubic metres. The larger furnaces need coke produced from high-quality coking coal. As a result, a larger volume of this type of coal will be required and China will have to turn to suppliers of the likes of Australia, Mongolia and, to a lesser extent, Mozambique who are all expanding supply.
In summary, Mr. Sharma says, ”The industry should expect premium metallurgical coal prices to fall to a price below US$240/tonne from now until Q4 2012. Although further downside price risks remain given ongoing macroeconomic uncertainty and new sources of supply entering the market place, the constant threat of additional unpredictable mine outages and the upcoming rainy season in key supply basins should keep them from falling too far. Long-term demand also remains strong in emerging markets.”
Editor’s notes:
Wood Mackenzie is the most comprehensive source of knowledge about the world’s energy and metals industries. We analyse and advise on every stage along the value chain - from discovery to delivery, and beyond - to provide clients with the commercial insight that makes them stronger. For more information visit: www.woodmac.com. Wood Mackenzie is a research consulting company and it is our preference is to be referred to as research consultants.
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Wednesday, 26 October 11
PWCS GLOBAL SHIPPING BENCHMARKING ANALYSIS: RECOVERY IN 2010 BUT GREAT UNCERTAINLY FOR 2011
The recovery of global trade in 2010 to the same levels as 2008 led to an improvement in the overall performance of shipping companies in 2010 compa ...
Wednesday, 26 October 11
INDIAN MARKET WAS REMAINED TIGHT THE WHOLE LAST WEEK - BRS
The market once more seems to be at a crossroads. The indices last week remained fairly stable (except for the Panamax sector), ending the week as f ...
Tuesday, 25 October 11
DRY BULK MARKET STEADY, ANALYSTS LOOKING FOR ADDED PRESSURE ON THE MARKET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market was unchanged on Monday, with the industry’s benchmark, the BDI (Baltic Dry Index) ending the session at 2,153 points, exa ...
Monday, 24 October 11
NEW HEAD OF INDONESIA'S MINING MINISTRY GETS RAKED OVER THE COALS - JOSEPH KIRSCHKE
COALspot.com - Following Indonesia’s presidential cabinet shakeup last week, many are questioning the qualifications of Energy and Mineral Res ...
Monday, 24 October 11
CHINA QINHUANGDAO COAL PRICE RISES TO HIGHEST IN THREE YEARS - BUSINESSWEEK
Business week reported that, China’s power-station coal price rose to the highest level in three years as power stations and central heating p ...
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- Economic Council, Georgia
- GVK Power & Infra Limited - India
- Makarim & Taira - Indonesia
- IEA Clean Coal Centre - UK
- Merrill Lynch Commodities Europe
- Uttam Galva Steels Limited - India
- Thiess Contractors Indonesia
- Sical Logistics Limited - India
- Siam City Cement PLC, Thailand
- Barasentosa Lestari - Indonesia
- South Luzon Thermal Energy Corporation
- Kaltim Prima Coal - Indonesia
- Petron Corporation, Philippines
- Vizag Seaport Private Limited - India
- Global Business Power Corporation, Philippines
- Global Coal Blending Company Limited - Australia
- Standard Chartered Bank - UAE
- The State Trading Corporation of India Ltd
- Port Waratah Coal Services - Australia
- Vedanta Resources Plc - India
- Globalindo Alam Lestari - Indonesia
- SMC Global Power, Philippines
- Savvy Resources Ltd - HongKong
- Mercator Lines Limited - India
- OPG Power Generation Pvt Ltd - India
- Ind-Barath Power Infra Limited - India
- Sakthi Sugars Limited - India
- AsiaOL BioFuels Corp., Philippines
- Bhoruka Overseas - Indonesia
- Siam City Cement - Thailand
- TeaM Sual Corporation - Philippines
- Power Finance Corporation Ltd., India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- GAC Shipping (India) Pvt Ltd
- San Jose City I Power Corp, Philippines
- Xindia Steels Limited - India
- Minerals Council of Australia
- Holcim Trading Pte Ltd - Singapore
- Antam Resourcindo - Indonesia
- Energy Link Ltd, New Zealand
- Singapore Mercantile Exchange
- Kapuas Tunggal Persada - Indonesia
- Georgia Ports Authority, United States
- Ministry of Transport, Egypt
- Wood Mackenzie - Singapore
- Eastern Coal Council - USA
- Jindal Steel & Power Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Grasim Industreis Ltd - India
- Pendopo Energi Batubara - Indonesia
- Iligan Light & Power Inc, Philippines
- Metalloyd Limited - United Kingdom
- Electricity Generating Authority of Thailand
- Commonwealth Bank - Australia
- Heidelberg Cement - Germany
- Price Waterhouse Coopers - Russia
- The University of Queensland
- Bukit Makmur.PT - Indonesia
- Directorate Of Revenue Intelligence - India
- Kobexindo Tractors - Indoneisa
- Baramulti Group, Indonesia
- Bharathi Cement Corporation - India
- Coalindo Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- GMR Energy Limited - India
- Samtan Co., Ltd - South Korea
- LBH Netherlands Bv - Netherlands
- Borneo Indobara - Indonesia
- Latin American Coal - Colombia
- CIMB Investment Bank - Malaysia
- Aboitiz Power Corporation - Philippines
- Directorate General of MIneral and Coal - Indonesia
- Deloitte Consulting - India
- Star Paper Mills Limited - India
- Cigading International Bulk Terminal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Interocean Group of Companies - India
- Indian Energy Exchange, India
- Rio Tinto Coal - Australia
- Carbofer General Trading SA - India
- Medco Energi Mining Internasional
- Maharashtra Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- McConnell Dowell - Australia
- Leighton Contractors Pty Ltd - Australia
- Videocon Industries ltd - India
- Australian Commodity Traders Exchange
- Agrawal Coal Company - India
- Maheswari Brothers Coal Limited - India
- Alfred C Toepfer International GmbH - Germany
- Coastal Gujarat Power Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Eastern Energy - Thailand
- Ministry of Mines - Canada
- MS Steel International - UAE
- Sree Jayajothi Cements Limited - India
- Ministry of Finance - Indonesia
- Central Java Power - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Africa Commodities Group - South Africa
- PetroVietnam Power Coal Import and Supply Company
- Mercuria Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Dalmia Cement Bharat India
- Cement Manufacturers Association - India
- The Treasury - Australian Government
- Indika Energy - Indonesia
- Thai Mozambique Logistica
- Electricity Authority, New Zealand
- SN Aboitiz Power Inc, Philippines
- Essar Steel Hazira Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Therma Luzon, Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- Australian Coal Association
- Kohat Cement Company Ltd. - Pakistan
- Kumho Petrochemical, South Korea
- Indo Tambangraya Megah - Indonesia
- ASAPP Information Group - India
- Ambuja Cements Ltd - India
- Salva Resources Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Bhatia International Limited - India
- Binh Thuan Hamico - Vietnam
- Edison Trading Spa - Italy
- Tamil Nadu electricity Board
- Romanian Commodities Exchange
- Intertek Mineral Services - Indonesia
- Oldendorff Carriers - Singapore
- IHS Mccloskey Coal Group - USA
- White Energy Company Limited
- Anglo American - United Kingdom
- Aditya Birla Group - India
- VISA Power Limited - India
- Jaiprakash Power Ventures ltd
- PowerSource Philippines DevCo
- Krishnapatnam Port Company Ltd. - India
- Asmin Koalindo Tuhup - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Formosa Plastics Group - Taiwan
- Karaikal Port Pvt Ltd - India
- Attock Cement Pakistan Limited
- Chamber of Mines of South Africa
- Indogreen Group - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Parliament of New Zealand
- Goldman Sachs - Singapore
- Sojitz Corporation - Japan
- Sindya Power Generating Company Private Ltd
- Independent Power Producers Association of India
- European Bulk Services B.V. - Netherlands
- Kalimantan Lumbung Energi - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Tata Chemicals Ltd - India
- New Zealand Coal & Carbon
- Larsen & Toubro Limited - India
- India Bulls Power Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Orica Australia Pty. Ltd.
- Meenaskhi Energy Private Limited - India
- Kepco SPC Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Energy Development Corp, Philippines
- Manunggal Multi Energi - Indonesia
- Riau Bara Harum - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Orica Mining Services - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Rashtriya Ispat Nigam Limited - India
- Indian Oil Corporation Limited
- Simpson Spence & Young - Indonesia
- Trasteel International SA, Italy
- Lanco Infratech Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Mintek Dendrill Indonesia
- SMG Consultants - Indonesia
- Meralco Power Generation, Philippines
- PTC India Limited - India
- Planning Commission, India
- Renaissance Capital - South Africa
- Toyota Tsusho Corporation, Japan
- Mjunction Services Limited - India
- Global Green Power PLC Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Gujarat Electricity Regulatory Commission - India
- Coal and Oil Company - UAE
- Semirara Mining Corp, Philippines
- Madhucon Powers Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Bank of Tokyo Mitsubishi UFJ Ltd
- GN Power Mariveles Coal Plant, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Malabar Cements Ltd - India
- Altura Mining Limited, Indonesia
- Sarangani Energy Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Central Electricity Authority - India
- CNBM International Corporation - China
- Kartika Selabumi Mining - Indonesia
- Posco Energy - South Korea
- ICICI Bank Limited - India
- Bangladesh Power Developement Board
- Parry Sugars Refinery, India
- Billiton Holdings Pty Ltd - Australia
- Gujarat Sidhee Cement - India
- Wilmar Investment Holdings
- Bahari Cakrawala Sebuku - Indonesia
- International Coal Ventures Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- London Commodity Brokers - England
- Marubeni Corporation - India
- Indonesian Coal Mining Association
- Bhushan Steel Limited - India
- Bukit Baiduri Energy - Indonesia
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