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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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Thursday, 27 September 12
MINING RE-COMMENCES AT ORPHEUS' B2 EAST KALIMANTAN COAL PROJECT
- B2 project overburden removal completed and coal exposed
- Coal getting has commenced with target production of 30,000tpm
- Orpheus to re ...
Thursday, 27 September 12
HANDY: THE PACIFIC MARKET IS GETTING WEAKER WITH UPCOMING GOLDEN WEEK HOLIDAYS - FEARNLEYS AS
Handy
Yet another week with rates softening in all trades. Especially owners with ships open Continent struggle to find employment paying decent mo ...
Thursday, 27 September 12
DRY BULK MARKET LOSES STEAM - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The rise of the BDI (Baltic Dry Index), the dry bulk industry’s benchmark during the course of the previous week, proved to be short-lived, as ...
Wednesday, 26 September 12
NEWBUILDING ORDERING ACTIVITY REMAINS SUBDUED ON GLOBAL MARKET UNCERTAINTY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Newbuilding ordering activity has been on the down side during the past few weeks, a trend also noticeable during the course of the past few days, a ...
Sunday, 23 September 12
AN ANOTHER UNSTABLE WEEK FOR INDONESIAN COAL SWAPS
COALspot.com - Sub-Bit Indonesia coal swaps (FOB ) for November 2012 delivery lost 1.10 percent and 0.916 percent WOW and DOD respectively ...
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- ICICI Bank Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Eastern Coal Council - USA
- Kaltim Prima Coal - Indonesia
- Orica Mining Services - Indonesia
- Borneo Indobara - Indonesia
- Indian Oil Corporation Limited
- Sarangani Energy Corporation, Philippines
- Madhucon Powers Ltd - India
- Renaissance Capital - South Africa
- Asmin Koalindo Tuhup - Indonesia
- Makarim & Taira - Indonesia
- Central Electricity Authority - India
- Pipit Mutiara Jaya. PT, Indonesia
- IHS Mccloskey Coal Group - USA
- CIMB Investment Bank - Malaysia
- Cement Manufacturers Association - India
- Bulk Trading Sa - Switzerland
- Georgia Ports Authority, United States
- Central Java Power - Indonesia
- Posco Energy - South Korea
- Romanian Commodities Exchange
- Agrawal Coal Company - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Grasim Industreis Ltd - India
- Australian Coal Association
- Kumho Petrochemical, South Korea
- Petron Corporation, Philippines
- Chamber of Mines of South Africa
- Standard Chartered Bank - UAE
- Altura Mining Limited, Indonesia
- PTC India Limited - India
- Baramulti Group, Indonesia
- Indogreen Group - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- GVK Power & Infra Limited - India
- Ambuja Cements Ltd - India
- Planning Commission, India
- Miang Besar Coal Terminal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Parry Sugars Refinery, India
- Trasteel International SA, Italy
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- TeaM Sual Corporation - Philippines
- GAC Shipping (India) Pvt Ltd
- Chettinad Cement Corporation Ltd - India
- Attock Cement Pakistan Limited
- Commonwealth Bank - Australia
- Energy Link Ltd, New Zealand
- Anglo American - United Kingdom
- Price Waterhouse Coopers - Russia
- Lanco Infratech Ltd - India
- Dalmia Cement Bharat India
- Indian Energy Exchange, India
- CNBM International Corporation - China
- Global Coal Blending Company Limited - Australia
- Krishnapatnam Port Company Ltd. - India
- Bukit Baiduri Energy - Indonesia
- Formosa Plastics Group - Taiwan
- Aboitiz Power Corporation - Philippines
- Meenaskhi Energy Private Limited - India
- Coastal Gujarat Power Limited - India
- Ministry of Mines - Canada
- Independent Power Producers Association of India
- Singapore Mercantile Exchange
- Electricity Authority, New Zealand
- New Zealand Coal & Carbon
- Manunggal Multi Energi - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Jaiprakash Power Ventures ltd
- Tamil Nadu electricity Board
- LBH Netherlands Bv - Netherlands
- White Energy Company Limited
- Global Business Power Corporation, Philippines
- Thai Mozambique Logistica
- The Treasury - Australian Government
- Indonesian Coal Mining Association
- Star Paper Mills Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Kalimantan Lumbung Energi - Indonesia
- Sojitz Corporation - Japan
- Kartika Selabumi Mining - Indonesia
- Interocean Group of Companies - India
- Kepco SPC Power Corporation, Philippines
- Mercator Lines Limited - India
- PNOC Exploration Corporation - Philippines
- Mercuria Energy - Indonesia
- The University of Queensland
- IEA Clean Coal Centre - UK
- Bukit Asam (Persero) Tbk - Indonesia
- Thiess Contractors Indonesia
- Uttam Galva Steels Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Maheswari Brothers Coal Limited - India
- Videocon Industries ltd - India
- Sindya Power Generating Company Private Ltd
- Holcim Trading Pte Ltd - Singapore
- European Bulk Services B.V. - Netherlands
- GN Power Mariveles Coal Plant, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ministry of Transport, Egypt
- Indika Energy - Indonesia
- Wilmar Investment Holdings
- Karaikal Port Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- Carbofer General Trading SA - India
- Bhatia International Limited - India
- Orica Australia Pty. Ltd.
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Binh Thuan Hamico - Vietnam
- Eastern Energy - Thailand
- Riau Bara Harum - Indonesia
- Samtan Co., Ltd - South Korea
- Semirara Mining and Power Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Toyota Tsusho Corporation, Japan
- Bharathi Cement Corporation - India
- Savvy Resources Ltd - HongKong
- Aditya Birla Group - India
- GMR Energy Limited - India
- Pendopo Energi Batubara - Indonesia
- Essar Steel Hazira Ltd - India
- Rio Tinto Coal - Australia
- Bangladesh Power Developement Board
- Globalindo Alam Lestari - Indonesia
- Tata Chemicals Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Heidelberg Cement - Germany
- London Commodity Brokers - England
- Edison Trading Spa - Italy
- Vizag Seaport Private Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Ministry of Finance - Indonesia
- Kobexindo Tractors - Indoneisa
- ASAPP Information Group - India
- Billiton Holdings Pty Ltd - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Bayan Resources Tbk. - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Goldman Sachs - Singapore
- Minerals Council of Australia
- Banpu Public Company Limited - Thailand
- Sical Logistics Limited - India
- Energy Development Corp, Philippines
- SN Aboitiz Power Inc, Philippines
- McConnell Dowell - Australia
- Therma Luzon, Inc, Philippines
- Iligan Light & Power Inc, Philippines
- Port Waratah Coal Services - Australia
- Sinarmas Energy and Mining - Indonesia
- South Luzon Thermal Energy Corporation
- SMC Global Power, Philippines
- Antam Resourcindo - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Barasentosa Lestari - Indonesia
- Latin American Coal - Colombia
- Global Green Power PLC Corporation, Philippines
- Vedanta Resources Plc - India
- Kideco Jaya Agung - Indonesia
- Africa Commodities Group - South Africa
- Semirara Mining Corp, Philippines
- Sakthi Sugars Limited - India
- Bhushan Steel Limited - India
- OPG Power Generation Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Meralco Power Generation, Philippines
- Oldendorff Carriers - Singapore
- Karbindo Abesyapradhi - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- International Coal Ventures Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Timah Investasi Mineral - Indoneisa
- The State Trading Corporation of India Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- MS Steel International - UAE
- Marubeni Corporation - India
- Economic Council, Georgia
- Electricity Generating Authority of Thailand
- Larsen & Toubro Limited - India
- Intertek Mineral Services - Indonesia
- Sree Jayajothi Cements Limited - India
- Directorate Of Revenue Intelligence - India
- Siam City Cement - Thailand
- Coal and Oil Company - UAE
- Malabar Cements Ltd - India
- India Bulls Power Limited - India
- Bhoruka Overseas - Indonesia
- Medco Energi Mining Internasional
- Bahari Cakrawala Sebuku - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Merrill Lynch Commodities Europe
- Mjunction Services Limited - India
- Australian Commodity Traders Exchange
- Kapuas Tunggal Persada - Indonesia
- PowerSource Philippines DevCo
- Indo Tambangraya Megah - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Metalloyd Limited - United Kingdom
- Xindia Steels Limited - India
- Gujarat Sidhee Cement - India
- Coalindo Energy - Indonesia
- SMG Consultants - Indonesia
- Parliament of New Zealand
- Mintek Dendrill Indonesia
- Deloitte Consulting - India
- Neyveli Lignite Corporation Ltd, - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jindal Steel & Power Ltd - India
- San Jose City I Power Corp, Philippines
- Power Finance Corporation Ltd., India
- Gujarat Electricity Regulatory Commission - India
- VISA Power Limited - India
- Wood Mackenzie - Singapore
- Ind-Barath Power Infra Limited - India
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