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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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Saturday, 18 February 23
PAKISTAN PLANS TO QUADRUPLE DOMESTIC COAL-FIRED POWER, MOVE AWAY FROM GAS - REUTERS
Pakistan plans to quadruple its domestic coal-fired capacity to reduce power generation costs and will not build new gas-fired plants in the coming ...
Saturday, 18 February 23
2023 MARINE FUEL MARKET PREDICTIONS - JOHN BERGMAN, AURAMARINE
The drive for decarbonisation we witnessed in 2022 has continued into 2023, demonstrating the shipping’s industry positive strides in the fas ...
Saturday, 28 January 23
COAL GROWTH BLIP NOT TO BE REPEATED - BALTIC EXCHANGE
As 2022 drew to a close, global coal demand looked set to end the year just 1.2% up on the previous year. But that small increase was enough to pus ...
Thursday, 26 January 23
CHINA'S COAL OUTPUT INCREASES IN DECEMBER 2022 - XINHUA
China’s raw coal output posted stable expansion in December 2022, official data showed.
The country produced 400 million tonne ...
Thursday, 26 January 23
COKING COAL NARROWS THE GAP ON THERMAL AS CHINA REOPENS - REUTERS
The premium of high-grade thermal coal over coking coal in Asia is shrinking as China’s re-opening and ending of a ban on imports from Austra ...
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- Sarangani Energy Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Baramulti Group, Indonesia
- Anglo American - United Kingdom
- Alfred C Toepfer International GmbH - Germany
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Metalloyd Limited - United Kingdom
- Globalindo Alam Lestari - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Lanco Infratech Ltd - India
- Indika Energy - Indonesia
- Minerals Council of Australia
- Directorate General of MIneral and Coal - Indonesia
- Formosa Plastics Group - Taiwan
- Bukit Makmur.PT - Indonesia
- Electricity Generating Authority of Thailand
- Eastern Energy - Thailand
- South Luzon Thermal Energy Corporation
- Aboitiz Power Corporation - Philippines
- Oldendorff Carriers - Singapore
- Vedanta Resources Plc - India
- TNB Fuel Sdn Bhd - Malaysia
- Interocean Group of Companies - India
- Heidelberg Cement - Germany
- White Energy Company Limited
- Dalmia Cement Bharat India
- Riau Bara Harum - Indonesia
- Siam City Cement - Thailand
- New Zealand Coal & Carbon
- Malabar Cements Ltd - India
- Standard Chartered Bank - UAE
- India Bulls Power Limited - India
- Bangladesh Power Developement Board
- Posco Energy - South Korea
- Bayan Resources Tbk. - Indonesia
- International Coal Ventures Pvt Ltd - India
- GMR Energy Limited - India
- Attock Cement Pakistan Limited
- Binh Thuan Hamico - Vietnam
- Toyota Tsusho Corporation, Japan
- Indonesian Coal Mining Association
- Karaikal Port Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Merrill Lynch Commodities Europe
- Sindya Power Generating Company Private Ltd
- Samtan Co., Ltd - South Korea
- Iligan Light & Power Inc, Philippines
- Tamil Nadu electricity Board
- Planning Commission, India
- Sical Logistics Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Singapore Mercantile Exchange
- The Treasury - Australian Government
- Energy Link Ltd, New Zealand
- Ambuja Cements Ltd - India
- Indo Tambangraya Megah - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Thiess Contractors Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Gujarat Electricity Regulatory Commission - India
- Barasentosa Lestari - Indonesia
- Aditya Birla Group - India
- Medco Energi Mining Internasional
- Madhucon Powers Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Rashtriya Ispat Nigam Limited - India
- Orica Mining Services - Indonesia
- Port Waratah Coal Services - Australia
- Pendopo Energi Batubara - Indonesia
- Thai Mozambique Logistica
- Carbofer General Trading SA - India
- SN Aboitiz Power Inc, Philippines
- Cement Manufacturers Association - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Gujarat Sidhee Cement - India
- Ministry of Finance - Indonesia
- Mercator Lines Limited - India
- Savvy Resources Ltd - HongKong
- Ind-Barath Power Infra Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kaltim Prima Coal - Indonesia
- Energy Development Corp, Philippines
- PNOC Exploration Corporation - Philippines
- Price Waterhouse Coopers - Russia
- Grasim Industreis Ltd - India
- Banpu Public Company Limited - Thailand
- Sojitz Corporation - Japan
- Sree Jayajothi Cements Limited - India
- Global Business Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- TeaM Sual Corporation - Philippines
- Meenaskhi Energy Private Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Parry Sugars Refinery, India
- Independent Power Producers Association of India
- Manunggal Multi Energi - Indonesia
- Ministry of Transport, Egypt
- Asmin Koalindo Tuhup - Indonesia
- Sakthi Sugars Limited - India
- Kideco Jaya Agung - Indonesia
- Bukit Baiduri Energy - Indonesia
- PowerSource Philippines DevCo
- LBH Netherlands Bv - Netherlands
- Indogreen Group - Indonesia
- Australian Coal Association
- IEA Clean Coal Centre - UK
- Miang Besar Coal Terminal - Indonesia
- San Jose City I Power Corp, Philippines
- Mintek Dendrill Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- The State Trading Corporation of India Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Kobexindo Tractors - Indoneisa
- Wood Mackenzie - Singapore
- Semirara Mining and Power Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Makarim & Taira - Indonesia
- Deloitte Consulting - India
- Wilmar Investment Holdings
- Altura Mining Limited, Indonesia
- Marubeni Corporation - India
- Kohat Cement Company Ltd. - Pakistan
- Bulk Trading Sa - Switzerland
- Larsen & Toubro Limited - India
- Australian Commodity Traders Exchange
- Eastern Coal Council - USA
- Xindia Steels Limited - India
- Tata Chemicals Ltd - India
- SMC Global Power, Philippines
- Therma Luzon, Inc, Philippines
- Agrawal Coal Company - India
- Trasteel International SA, Italy
- Kumho Petrochemical, South Korea
- Bharathi Cement Corporation - India
- OPG Power Generation Pvt Ltd - India
- Central Electricity Authority - India
- ASAPP Information Group - India
- Star Paper Mills Limited - India
- CNBM International Corporation - China
- Essar Steel Hazira Ltd - India
- Straits Asia Resources Limited - Singapore
- Leighton Contractors Pty Ltd - Australia
- Coal and Oil Company - UAE
- Kartika Selabumi Mining - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Renaissance Capital - South Africa
- Goldman Sachs - Singapore
- VISA Power Limited - India
- Orica Australia Pty. Ltd.
- Rio Tinto Coal - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Siam City Cement PLC, Thailand
- MS Steel International - UAE
- Meralco Power Generation, Philippines
- McConnell Dowell - Australia
- Holcim Trading Pte Ltd - Singapore
- Indian Oil Corporation Limited
- Offshore Bulk Terminal Pte Ltd, Singapore
- GVK Power & Infra Limited - India
- Chamber of Mines of South Africa
- Coastal Gujarat Power Limited - India
- Power Finance Corporation Ltd., India
- Directorate Of Revenue Intelligence - India
- Bhoruka Overseas - Indonesia
- Simpson Spence & Young - Indonesia
- Global Coal Blending Company Limited - Australia
- Global Green Power PLC Corporation, Philippines
- Economic Council, Georgia
- Borneo Indobara - Indonesia
- Central Java Power - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Mjunction Services Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Edison Trading Spa - Italy
- Timah Investasi Mineral - Indoneisa
- Jaiprakash Power Ventures ltd
- Romanian Commodities Exchange
- GN Power Mariveles Coal Plant, Philippines
- Maheswari Brothers Coal Limited - India
- Videocon Industries ltd - India
- Georgia Ports Authority, United States
- Petron Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Kalimantan Lumbung Energi - Indonesia
- Coalindo Energy - Indonesia
- Salva Resources Pvt Ltd - India
- Parliament of New Zealand
- Mercuria Energy - Indonesia
- IHS Mccloskey Coal Group - USA
- GAC Shipping (India) Pvt Ltd
- Ministry of Mines - Canada
- Krishnapatnam Port Company Ltd. - India
- Africa Commodities Group - South Africa
- Intertek Mineral Services - Indonesia
- Latin American Coal - Colombia
- Antam Resourcindo - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Bhushan Steel Limited - India
- London Commodity Brokers - England
- Bhatia International Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Vizag Seaport Private Limited - India
- SMG Consultants - Indonesia
- Uttam Galva Steels Limited - India
- Jindal Steel & Power Ltd - India
- Chettinad Cement Corporation Ltd - India
- CIMB Investment Bank - Malaysia
- The University of Queensland
- Indian Energy Exchange, India
- PTC India Limited - India
- Semirara Mining Corp, Philippines
- Commonwealth Bank - Australia
- ICICI Bank Limited - India
- Electricity Authority, New Zealand
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