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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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Sunday, 26 February 23
MAWANI AND JEDDAH CHAMBER SIGN AN AGREEMENT TO BUILD INTEGRATED LOGISTICS PARK
Press Release: The Saudi Ports Authority (Mawani) and Jeddah Chamber of Commerce and Industry have today inked an agreement to set up an integrated ...
Saturday, 25 February 23
INDONESIA IS STILL BY FAR THE TOP SUPPLIER OF COAL TO CHINA - BANCHERO COSTA
After a slow start in the first quarter, global coal trade has really picked up pace last year, and is now fully back to pre-Covid levels, said ban ...
Wednesday, 22 February 23
MARKET INSIGHT - INTERMODAL
The short-term outlook of the global soybean market is currently pivoted by a combination of weather patterns that are affecting the harvest progre ...
Saturday, 18 February 23
OIL UNLIKELY TO BREAK ABOVE $100/BBL THIS YEAR, J.P.MORGAN SAYS –- REUTERS
Brent oil prices are unlikely to breach the $100 a barrel level this year, barring any significant geopolitical drivers, with OPEC+ potentially add ...
Saturday, 18 February 23
CHINA'S COAL PRICES FALL TO 1 YR-LOW, CLOUDING DEMAND AND IMPORT OUTLOOK - REUTERS
China’s thermal coal prices hit their lowest levels in a year this week on rising inventories as domestic mine production is recovering faste ...
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- Bangladesh Power Developement Board
- Borneo Indobara - Indonesia
- Mintek Dendrill Indonesia
- Africa Commodities Group - South Africa
- Globalindo Alam Lestari - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- PTC India Limited - India
- Alfred C Toepfer International GmbH - Germany
- Eastern Energy - Thailand
- GN Power Mariveles Coal Plant, Philippines
- Thai Mozambique Logistica
- Bank of Tokyo Mitsubishi UFJ Ltd
- Singapore Mercantile Exchange
- SMC Global Power, Philippines
- Karaikal Port Pvt Ltd - India
- Posco Energy - South Korea
- Asmin Koalindo Tuhup - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Binh Thuan Hamico - Vietnam
- Kepco SPC Power Corporation, Philippines
- Meralco Power Generation, Philippines
- Uttam Galva Steels Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Timah Investasi Mineral - Indoneisa
- LBH Netherlands Bv - Netherlands
- Jindal Steel & Power Ltd - India
- Sakthi Sugars Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- GMR Energy Limited - India
- Xindia Steels Limited - India
- Kobexindo Tractors - Indoneisa
- SN Aboitiz Power Inc, Philippines
- Krishnapatnam Port Company Ltd. - India
- Kaltim Prima Coal - Indonesia
- Iligan Light & Power Inc, Philippines
- Merrill Lynch Commodities Europe
- Savvy Resources Ltd - HongKong
- GAC Shipping (India) Pvt Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Medco Energi Mining Internasional
- Attock Cement Pakistan Limited
- Minerals Council of Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Port Waratah Coal Services - Australia
- Star Paper Mills Limited - India
- Bukit Makmur.PT - Indonesia
- Edison Trading Spa - Italy
- Videocon Industries ltd - India
- Manunggal Multi Energi - Indonesia
- Bulk Trading Sa - Switzerland
- Metalloyd Limited - United Kingdom
- Lanco Infratech Ltd - India
- CNBM International Corporation - China
- Bahari Cakrawala Sebuku - Indonesia
- Ministry of Transport, Egypt
- Simpson Spence & Young - Indonesia
- Siam City Cement - Thailand
- Semirara Mining and Power Corporation, Philippines
- Riau Bara Harum - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Siam City Cement PLC, Thailand
- The Treasury - Australian Government
- Indonesian Coal Mining Association
- Electricity Authority, New Zealand
- Semirara Mining Corp, Philippines
- Indian Energy Exchange, India
- Gujarat Sidhee Cement - India
- Marubeni Corporation - India
- Global Coal Blending Company Limited - Australia
- Mjunction Services Limited - India
- Coastal Gujarat Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Cement Manufacturers Association - India
- MS Steel International - UAE
- Eastern Coal Council - USA
- Indian Oil Corporation Limited
- Essar Steel Hazira Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- Indogreen Group - Indonesia
- IEA Clean Coal Centre - UK
- PowerSource Philippines DevCo
- Ministry of Mines - Canada
- Karbindo Abesyapradhi - Indoneisa
- Larsen & Toubro Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Orica Mining Services - Indonesia
- Kideco Jaya Agung - Indonesia
- Ambuja Cements Ltd - India
- Grasim Industreis Ltd - India
- Petron Corporation, Philippines
- Mercator Lines Limited - India
- Sarangani Energy Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- VISA Power Limited - India
- Planning Commission, India
- Miang Besar Coal Terminal - Indonesia
- Sojitz Corporation - Japan
- Vizag Seaport Private Limited - India
- Samtan Co., Ltd - South Korea
- Leighton Contractors Pty Ltd - Australia
- Bukit Baiduri Energy - Indonesia
- Sindya Power Generating Company Private Ltd
- Renaissance Capital - South Africa
- Mercuria Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- ICICI Bank Limited - India
- Economic Council, Georgia
- Kalimantan Lumbung Energi - Indonesia
- ASAPP Information Group - India
- White Energy Company Limited
- Indika Energy - Indonesia
- Thiess Contractors Indonesia
- Maheswari Brothers Coal Limited - India
- Georgia Ports Authority, United States
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Latin American Coal - Colombia
- Formosa Plastics Group - Taiwan
- Deloitte Consulting - India
- Indo Tambangraya Megah - Indonesia
- Coalindo Energy - Indonesia
- Therma Luzon, Inc, Philippines
- Bhoruka Overseas - Indonesia
- Energy Development Corp, Philippines
- Energy Link Ltd, New Zealand
- Anglo American - United Kingdom
- Ministry of Finance - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Orica Australia Pty. Ltd.
- OPG Power Generation Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Goldman Sachs - Singapore
- Rashtriya Ispat Nigam Limited - India
- Tamil Nadu electricity Board
- Kartika Selabumi Mining - Indonesia
- Electricity Generating Authority of Thailand
- Gujarat Electricity Regulatory Commission - India
- Romanian Commodities Exchange
- The University of Queensland
- GVK Power & Infra Limited - India
- Agrawal Coal Company - India
- Bhatia International Limited - India
- Aboitiz Power Corporation - Philippines
- Antam Resourcindo - Indonesia
- IHS Mccloskey Coal Group - USA
- Standard Chartered Bank - UAE
- European Bulk Services B.V. - Netherlands
- Sree Jayajothi Cements Limited - India
- New Zealand Coal & Carbon
- Wood Mackenzie - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Bayan Resources Tbk. - Indonesia
- Heidelberg Cement - Germany
- Directorate Of Revenue Intelligence - India
- Australian Commodity Traders Exchange
- Commonwealth Bank - Australia
- PetroVietnam Power Coal Import and Supply Company
- Interocean Group of Companies - India
- International Coal Ventures Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Carbofer General Trading SA - India
- Trasteel International SA, Italy
- Chettinad Cement Corporation Ltd - India
- Central Java Power - Indonesia
- Aditya Birla Group - India
- Sical Logistics Limited - India
- Bhushan Steel Limited - India
- McConnell Dowell - Australia
- Dalmia Cement Bharat India
- South Luzon Thermal Energy Corporation
- Madhucon Powers Ltd - India
- Coal and Oil Company - UAE
- Oldendorff Carriers - Singapore
- Intertek Mineral Services - Indonesia
- SMG Consultants - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Ceylon Electricity Board - Sri Lanka
- Malabar Cements Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Power Finance Corporation Ltd., India
- The State Trading Corporation of India Ltd
- Rio Tinto Coal - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Baramulti Group, Indonesia
- Maharashtra Electricity Regulatory Commission - India
- San Jose City I Power Corp, Philippines
- Parliament of New Zealand
- Makarim & Taira - Indonesia
- Global Business Power Corporation, Philippines
- Wilmar Investment Holdings
- TeaM Sual Corporation - Philippines
- Vedanta Resources Plc - India
- Barasentosa Lestari - Indonesia
- Central Electricity Authority - India
- Salva Resources Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- CIMB Investment Bank - Malaysia
- London Commodity Brokers - England
- Banpu Public Company Limited - Thailand
- Independent Power Producers Association of India
- Straits Asia Resources Limited - Singapore
- Chamber of Mines of South Africa
- Pendopo Energi Batubara - Indonesia
- Tata Chemicals Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- AsiaOL BioFuels Corp., Philippines
- Australian Coal Association
- Parry Sugars Refinery, India
- Global Green Power PLC Corporation, Philippines
- Bharathi Cement Corporation - India
- Kumho Petrochemical, South Korea
- Altura Mining Limited, Indonesia
- Toyota Tsusho Corporation, Japan
- India Bulls Power Limited - India
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