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Tuesday, 15 October 13
CHINA COAL IMPORTS TO KEEP GROWING IN THE YEARS TO COME, ALBEIT AT A SLOWER RATE - EVA TZIMA / NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
In its latest monthly report, shipbroker Intermodal highlighted the growing role of coal in the energy mix. According to Intermodal's research analyst, Eva Tzima, "since the beginning of 2013, there has been a lot of debate as for what the future might hold for the trade of coal. The majority of coal production is used to fuel coal-fired power plants in the form also known as thermal coal. Coal, which is today the source that feeds almost 40% of global electricity requirements, has been the fastest growing energy source since the beginning of the 21st century, ac-cording to the International Energy Agency. It’s been mainly on the back of developing economies, like those of China and India that the traded volume of the commodity has witnessed a rapid increase. With China being globally the biggest producer and consumer of thermal coal, the demand for the latter has been inextricably linked with that of economic growth in the world’s second largest econo-my. As the rate of Chinese economic growth has been slowing down, so has the rate of coal consumption, while at the same time, due to its non green nature, the popularity of coal as an energy source has been gathering less and less supporters worldwide", she noted.
Tzima added that "despite the fact that China has been sitting on trillions of tonnes of reserves and therefore local appetite for coal has been historically satisfied onshore, as of the end of 2008 the country’s coal imports have started to increase at a very fast pace. The big beneficiary of this trend was no other than the dry bulkers, as the majority of those imports is realized by seaborne trade. Last year alone the an-nual increase of imported amounts of coal into China touched al-most 60% compared to those of 2011. As we head into the final quarter of 2013 it seems that an even higher figure of imports will be printed, proving that the trend is still strong. A little less than one third of Chinese coal imports is currently being satisfied by Indonesian reserves, while other Pacific region countries like Australia and Vietnam also account for substantial portions".
According to Intermodal's analyst, "the question that naturally comes to mind is why turning to offshore supplies for coal when the commodity is plentiful right there in your court? The answer is simple; Price. The cost of producing and transporting coal domestically has been higher than importing it. But as the country’s imports have continued to rise and its economy has gone into a slower gear, Chinese stockpiles have also increased significantly, fact which in its turn has put significant pressure on local prices. Since January alone, coal prices in China have softened more than 15%. As local prices have been softening a lot of reports have surfaced warning about possible pressure on coal imports going forward. On top of that, the Chinese government, in its effort to pursue more environmental friendly policies, could also weigh down on the future quantity of coal cargoes imported. The energy targets initially set forth by the government, as part of its overall pollution control plan, included both a ceiling on the imported volume and use, as well as a floor on the quality of coal consumed in the coun-try, adding further to the negative sentiment around coal usage altogether", Tzima noted.
"So, will the trade of coal start burning low in the Pacific region? I would think that most probably not. On the one hand the infrastructure modernization needed, should the government keep pushing for lower emissions of CO2, will add on to the cost of Chinese pro-duction. This will be reflected on the price of locally produced coal, restricting the gap between domestic and international prices to narrow down to a point where imports would no longer make economic sense. On top of that, while local coal prices have been softening, the same has happened to coal prices globally and even at a higher degree, so the price incentive for Chinese demand to dis-tant itself from imports doesn’t appear to be there. At the same time what originally started as a very solid plan to cap imported quantities has slowly been revised to a less strict policy, which doesn’t seem as hurtful for imports as it was in its initial form. This revision shows that cheaper energy sources are likely to hold centre stage, as it seems quite possible that the Chinese government would chose to partly sacrifice its “Green” targets for its “Growth” targets. In fact while it has pledged to reduce the country’s coal usage to 65% of its total energy mix, a 2% reduction from what it is today, it hasn’t set a specific amount of coal consumption. This means that under the current plan, the Chinese will still allow for growth in coal consumption should the country’s energy needs continue to rise. But will they do? In my view the fact that the Chinese government has compromised with slower economic growth targets for a longer period of time, in order to ensure the sustainability of that growth, in itself is supportive of firm on-going energy consumption within the country. Following the path of slower but more sustainable growth, energy consumption should be maintained at its current growth levels rather than exhaust itself in the medium term follow-ing strong but short-lived periods of overconsumption.
So despite the fact that King Coal might be facing some opposition, it seems that the Chinese will continue to be supportive of both imports and consumption of the commodity. And unless dramatic action is taken by their government, imports should keep increasing in the next years. This will almost certainly be an increase at a slower rate, but an increase nevertheless, as cheaper options of the commodity will be still made available through seaborne trade in the Asia-Pacific region, allowing for coal to keep burning hotter for a longer period than what some might chose to think...", Tzima concluded
Research Analyst - Eva Tzima
Source: Nikos Roussanoglou, Hellenic Shipping News
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Monday, 08 January 24
KOSPO TO BUY 80000 MT OF INDONESIAN LOW CALORIFIC VALUE COAL FOR FEB 2024
Korea Southern Power Co., Ltd. (KOSPO), is inviting bids for the supply of Indonesian Low Calorific Value Coal from qualified suppliers for Korean ...
Monday, 08 January 24
SEABORNE TRADE REACHES 12.4BN TONNES - CLARKSONS
China will establish a back-up coal production system by 2027 to stabilise prices and secure coal supply, the state planner said on Wednesday, even ...
Monday, 08 January 24
CAPESIZES START THE NEW YEAR ON POSITIVE NOTE - BALTIC EXCHANGE
Capesize
This week the capsize market has been marked by a mix of activities and challenges. Despite a slow start following the Christmas and N ...
Friday, 05 January 24
MORGAN STANLEY SEES LOWER OIL PRICES IN 2024 ON OVERSUPPLY CONCERNS - REUTERS
Morgan Stanley sees Brent crude prices anchored near $80 per barrel in the first half in 2024 before declining towards the end of the year as it ex ...
Friday, 05 January 24
INDIA'S COAL OUTPUT RISES NEARLY 11 PC IN DEC TO 92.87 MT - PTI
India’s coal production increased by 10.75 per cent to 92.87 million tonne in December 2023 as compared to the year-ago period, an official s ...
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- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GN Power Mariveles Coal Plant, Philippines
- Eastern Energy - Thailand
- Semirara Mining Corp, Philippines
- GVK Power & Infra Limited - India
- Global Business Power Corporation, Philippines
- ICICI Bank Limited - India
- Meralco Power Generation, Philippines
- IHS Mccloskey Coal Group - USA
- Manunggal Multi Energi - Indonesia
- Port Waratah Coal Services - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Directorate General of MIneral and Coal - Indonesia
- Bangladesh Power Developement Board
- Orica Australia Pty. Ltd.
- TeaM Sual Corporation - Philippines
- Dalmia Cement Bharat India
- White Energy Company Limited
- Miang Besar Coal Terminal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Electricity Generating Authority of Thailand
- European Bulk Services B.V. - Netherlands
- Banpu Public Company Limited - Thailand
- Bhushan Steel Limited - India
- Timah Investasi Mineral - Indoneisa
- Indo Tambangraya Megah - Indonesia
- Bharathi Cement Corporation - India
- Madhucon Powers Ltd - India
- Ind-Barath Power Infra Limited - India
- ASAPP Information Group - India
- Toyota Tsusho Corporation, Japan
- Sinarmas Energy and Mining - Indonesia
- Pendopo Energi Batubara - Indonesia
- Latin American Coal - Colombia
- Holcim Trading Pte Ltd - Singapore
- The University of Queensland
- Savvy Resources Ltd - HongKong
- Makarim & Taira - Indonesia
- Meenaskhi Energy Private Limited - India
- Jindal Steel & Power Ltd - India
- Bhatia International Limited - India
- Edison Trading Spa - Italy
- Kaltim Prima Coal - Indonesia
- Ministry of Mines - Canada
- Antam Resourcindo - Indonesia
- Wilmar Investment Holdings
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Standard Chartered Bank - UAE
- Indian Oil Corporation Limited
- Rio Tinto Coal - Australia
- Aditya Birla Group - India
- Anglo American - United Kingdom
- Leighton Contractors Pty Ltd - Australia
- Indogreen Group - Indonesia
- Samtan Co., Ltd - South Korea
- Ambuja Cements Ltd - India
- Star Paper Mills Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Chamber of Mines of South Africa
- PNOC Exploration Corporation - Philippines
- Sojitz Corporation - Japan
- San Jose City I Power Corp, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Economic Council, Georgia
- Binh Thuan Hamico - Vietnam
- Salva Resources Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Wood Mackenzie - Singapore
- Orica Mining Services - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- VISA Power Limited - India
- Thiess Contractors Indonesia
- Metalloyd Limited - United Kingdom
- IEA Clean Coal Centre - UK
- Renaissance Capital - South Africa
- Kalimantan Lumbung Energi - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Malabar Cements Ltd - India
- SMG Consultants - Indonesia
- London Commodity Brokers - England
- Aboitiz Power Corporation - Philippines
- Marubeni Corporation - India
- Gujarat Electricity Regulatory Commission - India
- Maharashtra Electricity Regulatory Commission - India
- Coal and Oil Company - UAE
- Indian Energy Exchange, India
- Sakthi Sugars Limited - India
- Electricity Authority, New Zealand
- Kumho Petrochemical, South Korea
- Heidelberg Cement - Germany
- Siam City Cement PLC, Thailand
- Central Electricity Authority - India
- Coastal Gujarat Power Limited - India
- Global Coal Blending Company Limited - Australia
- Tata Chemicals Ltd - India
- Ministry of Transport, Egypt
- Goldman Sachs - Singapore
- GMR Energy Limited - India
- South Luzon Thermal Energy Corporation
- Riau Bara Harum - Indonesia
- Chettinad Cement Corporation Ltd - India
- Mercuria Energy - Indonesia
- Mercator Lines Limited - India
- Georgia Ports Authority, United States
- Indika Energy - Indonesia
- PTC India Limited - India
- Therma Luzon, Inc, Philippines
- Jaiprakash Power Ventures ltd
- Kartika Selabumi Mining - Indonesia
- Vedanta Resources Plc - India
- Maheswari Brothers Coal Limited - India
- India Bulls Power Limited - India
- Essar Steel Hazira Ltd - India
- Iligan Light & Power Inc, Philippines
- The State Trading Corporation of India Ltd
- Trasteel International SA, Italy
- Grasim Industreis Ltd - India
- Price Waterhouse Coopers - Russia
- Bhoruka Overseas - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Borneo Indobara - Indonesia
- Globalindo Alam Lestari - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kepco SPC Power Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Videocon Industries ltd - India
- CIMB Investment Bank - Malaysia
- Indonesian Coal Mining Association
- LBH Netherlands Bv - Netherlands
- TNB Fuel Sdn Bhd - Malaysia
- Straits Asia Resources Limited - Singapore
- Sree Jayajothi Cements Limited - India
- SN Aboitiz Power Inc, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- New Zealand Coal & Carbon
- Karbindo Abesyapradhi - Indoneisa
- Medco Energi Mining Internasional
- Kobexindo Tractors - Indoneisa
- PetroVietnam Power Coal Import and Supply Company
- Lanco Infratech Ltd - India
- Deloitte Consulting - India
- Kohat Cement Company Ltd. - Pakistan
- Vijayanagar Sugar Pvt Ltd - India
- Thai Mozambique Logistica
- Uttam Galva Steels Limited - India
- Mjunction Services Limited - India
- OPG Power Generation Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Central Java Power - Indonesia
- International Coal Ventures Pvt Ltd - India
- Xindia Steels Limited - India
- Planning Commission, India
- Parry Sugars Refinery, India
- AsiaOL BioFuels Corp., Philippines
- Intertek Mineral Services - Indonesia
- Interocean Group of Companies - India
- Bulk Trading Sa - Switzerland
- Africa Commodities Group - South Africa
- MS Steel International - UAE
- Posco Energy - South Korea
- Oldendorff Carriers - Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mintek Dendrill Indonesia
- Attock Cement Pakistan Limited
- Formosa Plastics Group - Taiwan
- Pipit Mutiara Jaya. PT, Indonesia
- GAC Shipping (India) Pvt Ltd
- PowerSource Philippines DevCo
- Australian Coal Association
- Energy Link Ltd, New Zealand
- Commonwealth Bank - Australia
- Sindya Power Generating Company Private Ltd
- Petron Corporation, Philippines
- Carbofer General Trading SA - India
- McConnell Dowell - Australia
- Barasentosa Lestari - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Romanian Commodities Exchange
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- CNBM International Corporation - China
- Ministry of Finance - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Minerals Council of Australia
- Simpson Spence & Young - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Directorate Of Revenue Intelligence - India
- Rashtriya Ispat Nigam Limited - India
- Karaikal Port Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Agrawal Coal Company - India
- Tamil Nadu electricity Board
- Kapuas Tunggal Persada - Indonesia
- Bukit Baiduri Energy - Indonesia
- Coalindo Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- Larsen & Toubro Limited - India
- Merrill Lynch Commodities Europe
- Vizag Seaport Private Limited - India
- Independent Power Producers Association of India
- Singapore Mercantile Exchange
- Sical Logistics Limited - India
- Parliament of New Zealand
- Australian Commodity Traders Exchange
- Siam City Cement - Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- SMC Global Power, Philippines
- The Treasury - Australian Government
- Cement Manufacturers Association - India
- Baramulti Group, Indonesia
- Cigading International Bulk Terminal - Indonesia
- Sarangani Energy Corporation, Philippines
- Gujarat Sidhee Cement - India
- Eastern Coal Council - USA
- Kideco Jaya Agung - Indonesia
- Energy Development Corp, Philippines
- Altura Mining Limited, Indonesia
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