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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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Tuesday, 11 April 23
OIL RISES ON CHINA STIMULUS EXPECTATIONS, WEAKER DOLLAR - REUTERS
Oil prices rose on Tuesday on expectations of potential economic stimulus by China, healthy demand in the rest of Asia and a drop in U.S. crude sto ...
Sunday, 09 April 23
CHINA’S BUSINESS INCOME REBOUND POINTS TO IMPROVING ECONOMY: OFFICIAL - XINHUA
Chinese businesses have posted a strong rebound in sales revenue since the beginning of this year in the latest signal of an improving economy.
...
Sunday, 09 April 23
COAL INDIA TO BOOST SUPPLIES TO INDUSTRIES AS UTILITIES’ INVENTORIES RISE - REUTERS
Coal India Ltd will increase supplies to industries, the world’s largest coal miner said on Wednesday as fuel inventories at utilities run by ...
Thursday, 06 April 23
MARKET INSIGHT - INTERMODAL
LNG Current Supply/Demand Dynamics
This year, LNG supply will likely exceed demand, so prices will need to decline to levels that will encourag ...
Sunday, 26 March 23
EUROPE’S RUSH TO LNG COULD TURN INTO 'WORLD’S MOST EXPENSIVE AND UNNECESSARY INSURANCE POLICY'- CNBC
Europe’s rapid buildout of liquefied natural gas infrastructure is on track to far exceed demand by the end of the decade, according to new r ...
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- Bayan Resources Tbk. - Indonesia
- Vedanta Resources Plc - India
- Globalindo Alam Lestari - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Pendopo Energi Batubara - Indonesia
- Electricity Generating Authority of Thailand
- Global Business Power Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Tata Chemicals Ltd - India
- Attock Cement Pakistan Limited
- PTC India Limited - India
- Edison Trading Spa - Italy
- Bhatia International Limited - India
- Barasentosa Lestari - Indonesia
- Larsen & Toubro Limited - India
- Rio Tinto Coal - Australia
- LBH Netherlands Bv - Netherlands
- Meenaskhi Energy Private Limited - India
- Kumho Petrochemical, South Korea
- Economic Council, Georgia
- International Coal Ventures Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Central Java Power - Indonesia
- Indian Energy Exchange, India
- Malabar Cements Ltd - India
- Carbofer General Trading SA - India
- Thiess Contractors Indonesia
- Eastern Coal Council - USA
- Goldman Sachs - Singapore
- Cigading International Bulk Terminal - Indonesia
- Xindia Steels Limited - India
- Planning Commission, India
- Port Waratah Coal Services - Australia
- Kaltim Prima Coal - Indonesia
- The Treasury - Australian Government
- Merrill Lynch Commodities Europe
- PNOC Exploration Corporation - Philippines
- CNBM International Corporation - China
- Leighton Contractors Pty Ltd - Australia
- Thai Mozambique Logistica
- SN Aboitiz Power Inc, Philippines
- Indian Oil Corporation Limited
- Miang Besar Coal Terminal - Indonesia
- Marubeni Corporation - India
- Dalmia Cement Bharat India
- Madhucon Powers Ltd - India
- Siam City Cement PLC, Thailand
- Africa Commodities Group - South Africa
- The State Trading Corporation of India Ltd
- Bukit Asam (Persero) Tbk - Indonesia
- Ministry of Transport, Egypt
- Ministry of Finance - Indonesia
- Gujarat Sidhee Cement - India
- Ceylon Electricity Board - Sri Lanka
- Medco Energi Mining Internasional
- India Bulls Power Limited - India
- Kideco Jaya Agung - Indonesia
- IEA Clean Coal Centre - UK
- GN Power Mariveles Coal Plant, Philippines
- Semirara Mining and Power Corporation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jorong Barutama Greston.PT - Indonesia
- Independent Power Producers Association of India
- Bahari Cakrawala Sebuku - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Energy Development Corp, Philippines
- AsiaOL BioFuels Corp., Philippines
- Samtan Co., Ltd - South Korea
- Anglo American - United Kingdom
- Wood Mackenzie - Singapore
- Bulk Trading Sa - Switzerland
- Billiton Holdings Pty Ltd - Australia
- Chettinad Cement Corporation Ltd - India
- Price Waterhouse Coopers - Russia
- Meralco Power Generation, Philippines
- IHS Mccloskey Coal Group - USA
- GMR Energy Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Cement Manufacturers Association - India
- Sical Logistics Limited - India
- White Energy Company Limited
- Ministry of Mines - Canada
- TeaM Sual Corporation - Philippines
- Ambuja Cements Ltd - India
- Bangladesh Power Developement Board
- Bhushan Steel Limited - India
- Trasteel International SA, Italy
- Toyota Tsusho Corporation, Japan
- The University of Queensland
- Salva Resources Pvt Ltd - India
- Makarim & Taira - Indonesia
- Minerals Council of Australia
- Orica Australia Pty. Ltd.
- ASAPP Information Group - India
- Kepco SPC Power Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Sree Jayajothi Cements Limited - India
- Chamber of Mines of South Africa
- Simpson Spence & Young - Indonesia
- Indika Energy - Indonesia
- Parliament of New Zealand
- Georgia Ports Authority, United States
- Petrochimia International Co. Ltd.- Taiwan
- Kartika Selabumi Mining - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Lanco Infratech Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Aditya Birla Group - India
- Sarangani Energy Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Star Paper Mills Limited - India
- Indogreen Group - Indonesia
- Power Finance Corporation Ltd., India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Kapuas Tunggal Persada - Indonesia
- Parry Sugars Refinery, India
- Jindal Steel & Power Ltd - India
- Bukit Makmur.PT - Indonesia
- Indonesian Coal Mining Association
- Romanian Commodities Exchange
- GAC Shipping (India) Pvt Ltd
- Aboitiz Power Corporation - Philippines
- Sojitz Corporation - Japan
- Sinarmas Energy and Mining - Indonesia
- Deloitte Consulting - India
- Gujarat Electricity Regulatory Commission - India
- Mercuria Energy - Indonesia
- Wilmar Investment Holdings
- Holcim Trading Pte Ltd - Singapore
- Electricity Authority, New Zealand
- Asia Pacific Energy Resources Ventures Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Heidelberg Cement - Germany
- Interocean Group of Companies - India
- MS Steel International - UAE
- Renaissance Capital - South Africa
- New Zealand Coal & Carbon
- Coalindo Energy - Indonesia
- Petron Corporation, Philippines
- Commonwealth Bank - Australia
- Posco Energy - South Korea
- Semirara Mining Corp, Philippines
- Ind-Barath Power Infra Limited - India
- Coastal Gujarat Power Limited - India
- Singapore Mercantile Exchange
- Iligan Light & Power Inc, Philippines
- Sindya Power Generating Company Private Ltd
- Antam Resourcindo - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Jaiprakash Power Ventures ltd
- GVK Power & Infra Limited - India
- Uttam Galva Steels Limited - India
- Manunggal Multi Energi - Indonesia
- Coal and Oil Company - UAE
- Krishnapatnam Port Company Ltd. - India
- Eastern Energy - Thailand
- Formosa Plastics Group - Taiwan
- Directorate Of Revenue Intelligence - India
- SMC Global Power, Philippines
- Bhoruka Overseas - Indonesia
- London Commodity Brokers - England
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Central Electricity Authority - India
- Siam City Cement - Thailand
- Kohat Cement Company Ltd. - Pakistan
- VISA Power Limited - India
- Metalloyd Limited - United Kingdom
- TNB Fuel Sdn Bhd - Malaysia
- Mjunction Services Limited - India
- Banpu Public Company Limited - Thailand
- Australian Coal Association
- Asmin Koalindo Tuhup - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Savvy Resources Ltd - HongKong
- Agrawal Coal Company - India
- Bukit Baiduri Energy - Indonesia
- Standard Chartered Bank - UAE
- Orica Mining Services - Indonesia
- CIMB Investment Bank - Malaysia
- Neyveli Lignite Corporation Ltd, - India
- Oldendorff Carriers - Singapore
- Intertek Mineral Services - Indonesia
- San Jose City I Power Corp, Philippines
- South Luzon Thermal Energy Corporation
- Mercator Lines Limited - India
- Maheswari Brothers Coal Limited - India
- Baramulti Group, Indonesia
- European Bulk Services B.V. - Netherlands
- Bharathi Cement Corporation - India
- ICICI Bank Limited - India
- Altura Mining Limited, Indonesia
- Grasim Industreis Ltd - India
- Energy Link Ltd, New Zealand
- Karaikal Port Pvt Ltd - India
- Australian Commodity Traders Exchange
- Essar Steel Hazira Ltd - India
- Borneo Indobara - Indonesia
- Indo Tambangraya Megah - Indonesia
- McConnell Dowell - Australia
- Straits Asia Resources Limited - Singapore
- Mintek Dendrill Indonesia
- SMG Consultants - Indonesia
- Therma Luzon, Inc, Philippines
- Global Coal Blending Company Limited - Australia
- Binh Thuan Hamico - Vietnam
- Videocon Industries ltd - India
- PowerSource Philippines DevCo
- Tamil Nadu electricity Board
- Vizag Seaport Private Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Latin American Coal - Colombia
- Gujarat Mineral Development Corp Ltd - India
- Riau Bara Harum - Indonesia
- Kobexindo Tractors - Indoneisa
- Sakthi Sugars Limited - India
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