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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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Monday, 05 December 11
THE DECEMBER HBA FELL 11% FROM ITS PEAK AT US$127.05 PER TON IN FEBRUARY 2011
COALspot.com - Ministry of Energy and Mineral Resources of Indonesia has sets the December 2011 coal reference price at US$ 112.67 per ton US$ 3.98 ...
Monday, 05 December 11
SGX LAUNCHED IHS MCCLOSKEY/XINHUA INFOLINK OTC CFR SOUTH CHINA COAL CONTRACT TODAY
COALspot.com - In order to meet the demand of the coal industry for an effective coal hedging tool with counterparty credit risk mitigation facility ...
Monday, 05 December 11
DRY BULK RATES LOOKING TO EXTEND GAINS THIS WEEK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Capesize dry bulk carrier owners have had a great week, with rates rising for six straight sessions (including the end of the week before that). As ...
Sunday, 04 December 11
SUPRAMAX TRIPS VIA INDONESIA WERE REPORTED AROUND $ 7500 - 8000 PD
COALspot.com - The BDI and Cape index recovered this week. The BDI was up by 3.26 pct and Cape index saw a big jump and closed at 3409 points (up by ...
Saturday, 03 December 11
BORNEO TO SPEND US$600 MIO CAPEX - INSIDER STORIES
Insider Stories reported that, Coking coal miner PT Borneo Lumbung Energi & Metal Tbk (BORN) plans to spend US$600 million capital expenditure ( ...
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- Pipit Mutiara Jaya. PT, Indonesia
- SMC Global Power, Philippines
- Minerals Council of Australia
- Bharathi Cement Corporation - India
- Indogreen Group - Indonesia
- Intertek Mineral Services - Indonesia
- Binh Thuan Hamico - Vietnam
- CIMB Investment Bank - Malaysia
- Petron Corporation, Philippines
- Oldendorff Carriers - Singapore
- Metalloyd Limited - United Kingdom
- Kapuas Tunggal Persada - Indonesia
- Heidelberg Cement - Germany
- Bukit Baiduri Energy - Indonesia
- Standard Chartered Bank - UAE
- Merrill Lynch Commodities Europe
- Indika Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Gujarat Sidhee Cement - India
- Electricity Authority, New Zealand
- The Treasury - Australian Government
- TNB Fuel Sdn Bhd - Malaysia
- Altura Mining Limited, Indonesia
- Karbindo Abesyapradhi - Indoneisa
- International Coal Ventures Pvt Ltd - India
- SN Aboitiz Power Inc, Philippines
- Carbofer General Trading SA - India
- Larsen & Toubro Limited - India
- Siam City Cement PLC, Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Global Business Power Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Banpu Public Company Limited - Thailand
- Ministry of Finance - Indonesia
- Eastern Energy - Thailand
- Formosa Plastics Group - Taiwan
- Renaissance Capital - South Africa
- Therma Luzon, Inc, Philippines
- Bangladesh Power Developement Board
- Chettinad Cement Corporation Ltd - India
- Tata Chemicals Ltd - India
- Edison Trading Spa - Italy
- Parry Sugars Refinery, India
- Holcim Trading Pte Ltd - Singapore
- Cement Manufacturers Association - India
- Indian Oil Corporation Limited
- Global Green Power PLC Corporation, Philippines
- Indian Energy Exchange, India
- Karaikal Port Pvt Ltd - India
- Makarim & Taira - Indonesia
- Sojitz Corporation - Japan
- Sinarmas Energy and Mining - Indonesia
- Bulk Trading Sa - Switzerland
- Eastern Coal Council - USA
- Borneo Indobara - Indonesia
- White Energy Company Limited
- Timah Investasi Mineral - Indoneisa
- The State Trading Corporation of India Ltd
- India Bulls Power Limited - India
- Indonesian Coal Mining Association
- Alfred C Toepfer International GmbH - Germany
- Agrawal Coal Company - India
- Vijayanagar Sugar Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Coastal Gujarat Power Limited - India
- AsiaOL BioFuels Corp., Philippines
- ICICI Bank Limited - India
- TeaM Sual Corporation - Philippines
- Directorate General of MIneral and Coal - Indonesia
- Meralco Power Generation, Philippines
- Sarangani Energy Corporation, Philippines
- Central Java Power - Indonesia
- Commonwealth Bank - Australia
- Orica Australia Pty. Ltd.
- Africa Commodities Group - South Africa
- Mercator Lines Limited - India
- Directorate Of Revenue Intelligence - India
- Ind-Barath Power Infra Limited - India
- Energy Development Corp, Philippines
- Xindia Steels Limited - India
- Straits Asia Resources Limited - Singapore
- Ambuja Cements Ltd - India
- Central Electricity Authority - India
- Samtan Co., Ltd - South Korea
- Electricity Generating Authority of Thailand
- Power Finance Corporation Ltd., India
- Australian Coal Association
- Coal and Oil Company - UAE
- Kalimantan Lumbung Energi - Indonesia
- Savvy Resources Ltd - HongKong
- Latin American Coal - Colombia
- Thiess Contractors Indonesia
- Wood Mackenzie - Singapore
- Madhucon Powers Ltd - India
- Mercuria Energy - Indonesia
- Siam City Cement - Thailand
- Riau Bara Harum - Indonesia
- Globalindo Alam Lestari - Indonesia
- Bukit Makmur.PT - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Medco Energi Mining Internasional
- Jindal Steel & Power Ltd - India
- Simpson Spence & Young - Indonesia
- Barasentosa Lestari - Indonesia
- New Zealand Coal & Carbon
- Baramulti Group, Indonesia
- Maheswari Brothers Coal Limited - India
- ASAPP Information Group - India
- Salva Resources Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Sakthi Sugars Limited - India
- GVK Power & Infra Limited - India
- OPG Power Generation Pvt Ltd - India
- Star Paper Mills Limited - India
- McConnell Dowell - Australia
- Global Coal Blending Company Limited - Australia
- South Luzon Thermal Energy Corporation
- Posco Energy - South Korea
- IHS Mccloskey Coal Group - USA
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Leighton Contractors Pty Ltd - Australia
- Australian Commodity Traders Exchange
- Singapore Mercantile Exchange
- Sical Logistics Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Iligan Light & Power Inc, Philippines
- Grasim Industreis Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- PowerSource Philippines DevCo
- VISA Power Limited - India
- Sindya Power Generating Company Private Ltd
- Thai Mozambique Logistica
- LBH Netherlands Bv - Netherlands
- Rio Tinto Coal - Australia
- Billiton Holdings Pty Ltd - Australia
- Kideco Jaya Agung - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Indo Tambangraya Megah - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Orica Mining Services - Indonesia
- Videocon Industries ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Jaiprakash Power Ventures ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kaltim Prima Coal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Parliament of New Zealand
- CNBM International Corporation - China
- Semirara Mining Corp, Philippines
- Lanco Infratech Ltd - India
- Anglo American - United Kingdom
- Port Waratah Coal Services - Australia
- Kepco SPC Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Ministry of Mines - Canada
- Aboitiz Power Corporation - Philippines
- SMG Consultants - Indonesia
- Coalindo Energy - Indonesia
- Romanian Commodities Exchange
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mjunction Services Limited - India
- Energy Link Ltd, New Zealand
- Bhoruka Overseas - Indonesia
- Mintek Dendrill Indonesia
- Meenaskhi Energy Private Limited - India
- Goldman Sachs - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Semirara Mining and Power Corporation, Philippines
- Malabar Cements Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Price Waterhouse Coopers - Russia
- Independent Power Producers Association of India
- Kohat Cement Company Ltd. - Pakistan
- Planning Commission, India
- Bayan Resources Tbk. - Indonesia
- Wilmar Investment Holdings
- Toyota Tsusho Corporation, Japan
- Economic Council, Georgia
- Kartika Selabumi Mining - Indonesia
- Aditya Birla Group - India
- Attock Cement Pakistan Limited
- San Jose City I Power Corp, Philippines
- Deloitte Consulting - India
- Maharashtra Electricity Regulatory Commission - India
- Kobexindo Tractors - Indoneisa
- Trasteel International SA, Italy
- Vedanta Resources Plc - India
- Essar Steel Hazira Ltd - India
- European Bulk Services B.V. - Netherlands
- The University of Queensland
- Dalmia Cement Bharat India
- GMR Energy Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Tamil Nadu electricity Board
- Uttam Galva Steels Limited - India
- IEA Clean Coal Centre - UK
- PNOC Exploration Corporation - Philippines
- Chamber of Mines of South Africa
- PTC India Limited - India
- Manunggal Multi Energi - Indonesia
- Cigading International Bulk Terminal - Indonesia
- London Commodity Brokers - England
- Bhushan Steel Limited - India
- Marubeni Corporation - India
- MS Steel International - UAE
- GAC Shipping (India) Pvt Ltd
- Kumho Petrochemical, South Korea
- Vizag Seaport Private Limited - India
- Georgia Ports Authority, United States
- Bhatia International Limited - India
- Ministry of Transport, Egypt
- Interocean Group of Companies - India
- Antam Resourcindo - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Pendopo Energi Batubara - Indonesia
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