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Sunday, 30 September 12
INDONESIA HAS NO PLAN TO CAP COAL PRODUCTION
 COALspot.com - “The current low coal prices were mainly due to a global oversupply condition, spurred by numerous mining exploitations in the past 3-4 years due to attractive coal prices”, said Edi Prasodjo, Director of Coal Business Development at the Ministry of Energy and Mineral Resources (MEMR), Monday during “Indonesia Coal Price Trend and Market Outlook” conference, as quoted by Bahana Securites note to its clients.
Bahana Securities note further said that, Edi Prasodjo further commented that current low prices are challenging for Indonesian small-to-medium coal companies with many of them having stopped production. MEMR forecasts a lower production output of coal in 2012. Ministry of Energy and Mineral Resources is expecting the will fall to 332 million tons, down 6 percent y-y.
Energy and Mineral Resources ministry, however, forecasted a higher production output in 2013 and 2014. The ministry is expected the production in 2013 will be around 337 million tons and 342 million tons in 2014, still at same levels or lower than 2011 production volume.
According to Bahana’s note, Indonesia has already produced around 215 million tons of coal for first seven months of this year expects further deceleration in the remaining period of 2012.
The government has no plan to cap coal production to mitigate the current oversupply condition, as indicated by Director of Coal Business Development at the Ministry of Energy and Mineral Resources. Bahana said in its note, according to Edi Prasodjo, the production output restriction is unlikely to occur in the short-term as coal’s importance in the Indonesian state budget. Coal exports contributes IDR 20.8 trillion as non-tax state revenue in 2011 up from IDR5.8t in 2007.
In addition to that, the government is still converting all Non-Clean and Clear (Non-CNC) IUPs to be CNC IUPs and it is expected to be completed by the end of this year.
According to Bahana, “we learned an interesting development within the global coal industry”. Bahana said, according to a coal company, some of US manufacturers are starting to pulling back manufacturing plants from China to the US on the back of lower production costs helped by the availability of cheap shale gas. This coupled with the eventual repair of China’s railway problem and other technological advancement such as HVDC cable will pose longer term uncertainties on the fundamentals of coal.
Bahana adopts a different view on world coal outlook compared to a Mackenzie keynote speaker, in which he stated that longer term coal fundamentals would remain intact with main demand coming from China and India. Mackenzie believes that Chinese coal imports are mainly driven by coal price arbitrage between domestic and international coal prices.
Testimony to this was higher 8M12 coal imports (+44% y-y, exhibit 10), although we note volumes had been on the decline in the past two months with August volumes just up a paltry 4% y-y. In 2013, Mackenzie also expects China’s coal imports to grow 11% y-y to 250m tons, before further increasing to 500m tons in 2020 on higher demand. In India, coal imports are expected to almost double from the current 100m tons to nearly 200m tons in 2020 caused by infrastructure bottleneck (India's power plants are mainly concentrated in Western, Southern and Northern India, while production is based in Eastern India). However, we note that Mackenzie does not see much coal price improvement through 2013 from current levels.
Bahana believes upside potential on coal price remains limited due to weak coal demand. Bahana maintains its 2012 average coal benchmark price at USD97/ton, but Bahana’s forecasts prices for 2013 is much lesser than 2012 price. Bahana maintains it 2013 coal prices at USD85 / ton in 2013, around US$ 12.00 below its 2012 forecasts. Bahana retains its underweight stance on coal sector and expect its underperformance to persist going forward. Currently, with 23% average downside to our target prices (TPs), all of Bahana’s covered coal companies have reduce ratings.
In the meantime, the Jakarta globe, an English new paper in Indonesia reported that, the Indonesian government has scrapped plans to raise coal sales in the domestic market until at least 2014, as state utility company Perusahaan Listrik Negara (PLN), its main customer, has more than enough stock, a senior official at the Energy and Mineral Resources Ministry said.
“There used to be a plan to increase the DMO so that PLN could get more [coal], but now PLN has more than enough,” Rudi Rubiandini, deputy minister for energy and mineral resources, said on Friday, as quoted by The Jakarta Globe.
According to paper, Rudi’s statement echoed those of Helmi Najamudin, the head of the coal division at PLN, who said supply had surpassed consumption for the next two years. Helmi said coal consumption would exceed supply in 2015, where it will reach 88.8 million tons.
As Indonesian domestic market is not going to absorb more coal at least for another two years, the oversupply of coal to export market is unavoidable. Hence the coal price recovery will be in slow move unless there is any unexpected situation occurred in oil industry, oil transportation routes or demand side.
"The best way to escape from a problem is to solve it." – unknown source
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Wednesday, 10 October 12
TAPPING OPPORTUNITIES WITHIN GLOBAL ECONOMIC PERSPECTIVE
Press Release: Mining sector will continue to play a significant role in supporting industrial and economic development in Indonesia which is curren ...
Tuesday, 09 October 12
REALM RESOURCES RECOMMENCES DRILLING AT KATINGAN RIA COAL PROJECT
COALspot.com : Realm Resources Ltd. (ASX) has announced that it has commenced work on the phase three technical programme at its Katingan Project in ...
Sunday, 07 October 12
INDONESIAN GOVERNMENT DECLARED HBA FELL AGAIN IN OCTOBER
COALspot.com - The Indonesian government’s declared coal reference price has lost US$ 0.17 per MT M-M.
The monthly coal referen ...
Saturday, 06 October 12
CFR SOUTH CHINA COAL SWAPS FOR DECEMBER'13 DELIVERY GAINED 1.3 PERCENT W-W
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for December 2012 delivery gained 0.098 percent and 0.164 percent W-W and D-D respectively o ...
Saturday, 06 October 12
FREIGHT MARKET IS LIKELY TO PICK AFTER THE HOLIDAYS IN CHINA - VISTAAR
COALspot.com - The freight market appeared to be seeing some increase BDI up by 14.23 pct closing at 875 points. The Cape and Panamax index also saw ...
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- Jaiprakash Power Ventures ltd
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- Ministry of Transport, Egypt
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- Globalindo Alam Lestari - Indonesia
- OPG Power Generation Pvt Ltd - India
- Intertek Mineral Services - Indonesia
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- Anglo American - United Kingdom
- Semirara Mining Corp, Philippines
- Ministry of Mines - Canada
- Deloitte Consulting - India
- Sindya Power Generating Company Private Ltd
- New Zealand Coal & Carbon
- Star Paper Mills Limited - India
- CIMB Investment Bank - Malaysia
- Pendopo Energi Batubara - Indonesia
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- Energy Development Corp, Philippines
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- Medco Energi Mining Internasional
- Heidelberg Cement - Germany
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Gujarat Sidhee Cement - India
- Eastern Energy - Thailand
- Samtan Co., Ltd - South Korea
- Kaltim Prima Coal - Indonesia
- Kideco Jaya Agung - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Romanian Commodities Exchange
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- SMC Global Power, Philippines
- Metalloyd Limited - United Kingdom
- The University of Queensland
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- ASAPP Information Group - India
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- PowerSource Philippines DevCo
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- Wilmar Investment Holdings
- Sarangani Energy Corporation, Philippines
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- Kartika Selabumi Mining - Indonesia
- Grasim Industreis Ltd - India
- Interocean Group of Companies - India
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- Parry Sugars Refinery, India
- Essar Steel Hazira Ltd - India
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- Kumho Petrochemical, South Korea
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- Bangladesh Power Developement Board
- Singapore Mercantile Exchange
- Therma Luzon, Inc, Philippines
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- Alfred C Toepfer International GmbH - Germany
- Billiton Holdings Pty Ltd - Australia
- Minerals Council of Australia
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- Price Waterhouse Coopers - Russia
- GAC Shipping (India) Pvt Ltd
- Australian Coal Association
- PNOC Exploration Corporation - Philippines
- Indian Energy Exchange, India
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- Tata Chemicals Ltd - India
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- Electricity Authority, New Zealand
- Eastern Coal Council - USA
- Power Finance Corporation Ltd., India
- International Coal Ventures Pvt Ltd - India
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- Merrill Lynch Commodities Europe
- Directorate Of Revenue Intelligence - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- South Luzon Thermal Energy Corporation
- London Commodity Brokers - England
- Leighton Contractors Pty Ltd - Australia
- Edison Trading Spa - Italy
- Bukit Baiduri Energy - Indonesia
- Agrawal Coal Company - India
- Uttam Galva Steels Limited - India
- Larsen & Toubro Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Bhoruka Overseas - Indonesia
- Straits Asia Resources Limited - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vedanta Resources Plc - India
- Wood Mackenzie - Singapore
- Independent Power Producers Association of India
- Barasentosa Lestari - Indonesia
- Global Coal Blending Company Limited - Australia
- Trasteel International SA, Italy
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- GMR Energy Limited - India
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- Carbofer General Trading SA - India
- White Energy Company Limited
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- Renaissance Capital - South Africa
- SMG Consultants - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Banpu Public Company Limited - Thailand
- Siam City Cement PLC, Thailand
- Electricity Generating Authority of Thailand
- Commonwealth Bank - Australia
- LBH Netherlands Bv - Netherlands
- Offshore Bulk Terminal Pte Ltd, Singapore
- Jindal Steel & Power Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Makarim & Taira - Indonesia
- Attock Cement Pakistan Limited
- Indogreen Group - Indonesia
- Kobexindo Tractors - Indoneisa
- Maheswari Brothers Coal Limited - India
- Orica Australia Pty. Ltd.
- Vizag Seaport Private Limited - India
- Global Green Power PLC Corporation, Philippines
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- AsiaOL BioFuels Corp., Philippines
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- Sinarmas Energy and Mining - Indonesia
- Chettinad Cement Corporation Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Bhushan Steel Limited - India
- Aditya Birla Group - India
- Indian Oil Corporation Limited
- Chamber of Mines of South Africa
- Central Electricity Authority - India
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- Australian Commodity Traders Exchange
- GVK Power & Infra Limited - India
- Toyota Tsusho Corporation, Japan
- The State Trading Corporation of India Ltd
- Savvy Resources Ltd - HongKong
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- Bahari Cakrawala Sebuku - Indonesia
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- Bayan Resources Tbk. - Indonesia
- Ministry of Finance - Indonesia
- Tamil Nadu electricity Board
- IHS Mccloskey Coal Group - USA
- Indonesian Coal Mining Association
- Timah Investasi Mineral - Indoneisa
- San Jose City I Power Corp, Philippines
- Indika Energy - Indonesia
- The Treasury - Australian Government
- Planning Commission, India
- Rio Tinto Coal - Australia
- Indo Tambangraya Megah - Indonesia
- Coastal Gujarat Power Limited - India
- Thai Mozambique Logistica
- Cement Manufacturers Association - India
- IEA Clean Coal Centre - UK
- TeaM Sual Corporation - Philippines
- Mintek Dendrill Indonesia
- McConnell Dowell - Australia
- Bhatia International Limited - India
- Semirara Mining and Power Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Sical Logistics Limited - India
- Posco Energy - South Korea
- Africa Commodities Group - South Africa
- SN Aboitiz Power Inc, Philippines
- Riau Bara Harum - Indonesia
- Madhucon Powers Ltd - India
- Port Waratah Coal Services - Australia
- Coal and Oil Company - UAE
- TNB Fuel Sdn Bhd - Malaysia
- Economic Council, Georgia
- Directorate General of MIneral and Coal - Indonesia
- Bharathi Cement Corporation - India
- Sojitz Corporation - Japan
- Mercator Lines Limited - India
- Iligan Light & Power Inc, Philippines
- Latin American Coal - Colombia
- Meralco Power Generation, Philippines
- Parliament of New Zealand
- Gujarat Electricity Regulatory Commission - India
- Dalmia Cement Bharat India
- Bulk Trading Sa - Switzerland
- Kalimantan Lumbung Energi - Indonesia
- Formosa Plastics Group - Taiwan
- Standard Chartered Bank - UAE
- Energy Link Ltd, New Zealand
- Thiess Contractors Indonesia
- Petron Corporation, Philippines
- PTC India Limited - India
- Videocon Industries ltd - India
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- Maharashtra Electricity Regulatory Commission - India
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- Georgia Ports Authority, United States
- Cigading International Bulk Terminal - Indonesia
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- Siam City Cement - Thailand
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