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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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Tuesday, 18 October 11
INDONESIAN PRESIDENT APPOINTS JERO WACIK AS NEW MINISTER OF ENERGY & MINERAL RESOURCES
COALspot.com - Jero Wacik has been appointed as minister of energy and mineral resources of Indonesia replacing Darwin Saleh and Prof. Widjajono Par ...
Tuesday, 18 October 11
DELTA DUNIA MAKMUR HAS PRODUCED 3.0 MILLION TONS OF COAL LAST MONTH
COALspot.com - PT. Delta Dunia Makmur, wholly owned subsidiary, PT Bukit Makmur Mandiri Utama (BUMA), Delta Dunia Makmur has removed 1.4 million bcm ...
Monday, 17 October 11
KOWEPO TO BUY 260,000 MT BITUMINOUS COAL
COALspot.com - KOWEPO has issued a spot tender for 260,000MT of minimum 5,600kcal/kg NAR Bituminous Coal.
The tender document also mentioned tha ...
Monday, 17 October 11
CAPESIZE SHIPPING COSTS CLIMB TO 10-MONTH HIGH ON ORE IMPORTS
The cost to hire capesize vessels climbed to a 10-month high as rising imports of iron ore to China boosted demand for the ships.Monthly iron-ore sh ...
Saturday, 15 October 11
BUNKER PRICES AND DEMANDS PUSHED FREIGHT RATES UP - VISTAAR
COALspot.com - The market continued to be firm with all segments moving up with biggest gain in Handy size segment up by 15 pct. The BDI was u ...
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- PNOC Exploration Corporation - Philippines
- Ceylon Electricity Board - Sri Lanka
- SN Aboitiz Power Inc, Philippines
- Leighton Contractors Pty Ltd - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Mercuria Energy - Indonesia
- The Treasury - Australian Government
- Binh Thuan Hamico - Vietnam
- Cigading International Bulk Terminal - Indonesia
- TeaM Sual Corporation - Philippines
- Anglo American - United Kingdom
- Kapuas Tunggal Persada - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indonesian Coal Mining Association
- Carbofer General Trading SA - India
- MS Steel International - UAE
- Rio Tinto Coal - Australia
- Kumho Petrochemical, South Korea
- Offshore Bulk Terminal Pte Ltd, Singapore
- Australian Commodity Traders Exchange
- Bank of Tokyo Mitsubishi UFJ Ltd
- Thiess Contractors Indonesia
- Eastern Coal Council - USA
- Bulk Trading Sa - Switzerland
- Coastal Gujarat Power Limited - India
- Eastern Energy - Thailand
- Trasteel International SA, Italy
- Xindia Steels Limited - India
- Jindal Steel & Power Ltd - India
- Economic Council, Georgia
- Antam Resourcindo - Indonesia
- SMC Global Power, Philippines
- Sarangani Energy Corporation, Philippines
- New Zealand Coal & Carbon
- Bukit Baiduri Energy - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- IHS Mccloskey Coal Group - USA
- PetroVietnam Power Coal Import and Supply Company
- Semirara Mining Corp, Philippines
- Latin American Coal - Colombia
- International Coal Ventures Pvt Ltd - India
- Wilmar Investment Holdings
- Indian Energy Exchange, India
- Power Finance Corporation Ltd., India
- Tata Chemicals Ltd - India
- Aditya Birla Group - India
- Directorate General of MIneral and Coal - Indonesia
- Therma Luzon, Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Jaiprakash Power Ventures ltd
- Sindya Power Generating Company Private Ltd
- Borneo Indobara - Indonesia
- Mercator Lines Limited - India
- Sojitz Corporation - Japan
- Krishnapatnam Port Company Ltd. - India
- Orica Mining Services - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Straits Asia Resources Limited - Singapore
- Semirara Mining and Power Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Kalimantan Lumbung Energi - Indonesia
- Edison Trading Spa - Italy
- Price Waterhouse Coopers - Russia
- Singapore Mercantile Exchange
- Videocon Industries ltd - India
- Parry Sugars Refinery, India
- GAC Shipping (India) Pvt Ltd
- Grasim Industreis Ltd - India
- IEA Clean Coal Centre - UK
- Ministry of Mines - Canada
- The University of Queensland
- Parliament of New Zealand
- GN Power Mariveles Coal Plant, Philippines
- Agrawal Coal Company - India
- OPG Power Generation Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Meenaskhi Energy Private Limited - India
- Essar Steel Hazira Ltd - India
- Independent Power Producers Association of India
- Salva Resources Pvt Ltd - India
- Oldendorff Carriers - Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Ind-Barath Power Infra Limited - India
- Mjunction Services Limited - India
- Deloitte Consulting - India
- Ministry of Transport, Egypt
- LBH Netherlands Bv - Netherlands
- India Bulls Power Limited - India
- Merrill Lynch Commodities Europe
- Kartika Selabumi Mining - Indonesia
- Star Paper Mills Limited - India
- Goldman Sachs - Singapore
- Bayan Resources Tbk. - Indonesia
- Electricity Authority, New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Heidelberg Cement - Germany
- Thai Mozambique Logistica
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Dalmia Cement Bharat India
- South Luzon Thermal Energy Corporation
- Chettinad Cement Corporation Ltd - India
- Coal and Oil Company - UAE
- Minerals Council of Australia
- Bahari Cakrawala Sebuku - Indonesia
- Bhatia International Limited - India
- Central Java Power - Indonesia
- Manunggal Multi Energi - Indonesia
- Indo Tambangraya Megah - Indonesia
- Sical Logistics Limited - India
- Global Business Power Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- ASAPP Information Group - India
- Bukit Asam (Persero) Tbk - Indonesia
- Orica Australia Pty. Ltd.
- Formosa Plastics Group - Taiwan
- Kepco SPC Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Posco Energy - South Korea
- Interocean Group of Companies - India
- PowerSource Philippines DevCo
- Directorate Of Revenue Intelligence - India
- Petrochimia International Co. Ltd.- Taiwan
- Central Electricity Authority - India
- Rashtriya Ispat Nigam Limited - India
- Altura Mining Limited, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Samtan Co., Ltd - South Korea
- Standard Chartered Bank - UAE
- Billiton Holdings Pty Ltd - Australia
- The State Trading Corporation of India Ltd
- Pendopo Energi Batubara - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Ambuja Cements Ltd - India
- Commonwealth Bank - Australia
- Alfred C Toepfer International GmbH - Germany
- Maharashtra Electricity Regulatory Commission - India
- Energy Link Ltd, New Zealand
- Bukit Makmur.PT - Indonesia
- Larsen & Toubro Limited - India
- GVK Power & Infra Limited - India
- Chamber of Mines of South Africa
- Kobexindo Tractors - Indoneisa
- Intertek Mineral Services - Indonesia
- Baramulti Group, Indonesia
- Simpson Spence & Young - Indonesia
- Electricity Generating Authority of Thailand
- Neyveli Lignite Corporation Ltd, - India
- Mintek Dendrill Indonesia
- Tamil Nadu electricity Board
- Coalindo Energy - Indonesia
- Makarim & Taira - Indonesia
- Medco Energi Mining Internasional
- Marubeni Corporation - India
- Georgia Ports Authority, United States
- Global Green Power PLC Corporation, Philippines
- Romanian Commodities Exchange
- Kideco Jaya Agung - Indonesia
- Sakthi Sugars Limited - India
- CIMB Investment Bank - Malaysia
- Energy Development Corp, Philippines
- Wood Mackenzie - Singapore
- White Energy Company Limited
- Indogreen Group - Indonesia
- Metalloyd Limited - United Kingdom
- Petron Corporation, Philippines
- GMR Energy Limited - India
- Aboitiz Power Corporation - Philippines
- Australian Coal Association
- Vedanta Resources Plc - India
- Meralco Power Generation, Philippines
- ICICI Bank Limited - India
- Sree Jayajothi Cements Limited - India
- PTC India Limited - India
- London Commodity Brokers - England
- Sinarmas Energy and Mining - Indonesia
- Siam City Cement PLC, Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Barasentosa Lestari - Indonesia
- Bangladesh Power Developement Board
- Holcim Trading Pte Ltd - Singapore
- Port Waratah Coal Services - Australia
- Gujarat Sidhee Cement - India
- SMG Consultants - Indonesia
- Madhucon Powers Ltd - India
- Malabar Cements Ltd - India
- CNBM International Corporation - China
- Bhoruka Overseas - Indonesia
- Bhushan Steel Limited - India
- Bharathi Cement Corporation - India
- Gujarat Electricity Regulatory Commission - India
- Cement Manufacturers Association - India
- Vizag Seaport Private Limited - India
- Uttam Galva Steels Limited - India
- Savvy Resources Ltd - HongKong
- San Jose City I Power Corp, Philippines
- Indika Energy - Indonesia
- VISA Power Limited - India
- Planning Commission, India
- Ministry of Finance - Indonesia
- Indian Oil Corporation Limited
- Iligan Light & Power Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- McConnell Dowell - Australia
- Attock Cement Pakistan Limited
- Renaissance Capital - South Africa
- Kaltim Prima Coal - Indonesia
- Siam City Cement - Thailand
- Lanco Infratech Ltd - India
- Africa Commodities Group - South Africa
- Global Coal Blending Company Limited - Australia
- Globalindo Alam Lestari - Indonesia
- Riau Bara Harum - Indonesia
- Miang Besar Coal Terminal - Indonesia
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