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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, 19 December 22
ENERGY CRISIS FUELS COAL COMEBACK IN GERMANY - REUTERS
Coal has made a comeback in Germany this year, as Europe’s largest economy turns to the dirty fuel to power it through an energy crisis.
...
Thursday, 15 December 22
MARKET INSIGHT - INTERMODAL
While observing the ship repair market very close to the end of the year, we are confident that shipyards worldwide are entering a new era. The nex ...
Tuesday, 13 December 22
STRONG COAL PRICES SUPPORT ROBUST EARNINGS AT INDONESIAN COAL MINERS - FITCH RATINGS
Fitch Ratings expects cash flow generation at Indonesian coal miners to remain strong in 2023, based on its forecast for coal prices to remain high ...
Tuesday, 13 December 22
BIMCO CII CLAUSE FINALLY RELEASED: DOES IT MAKE ANY SENSE OF CCI? - WFW
WHAT IS CII?
The new International Maritime Organisation’s (“IMO’s”) Carbon Intensity Indicator (“CII”) cer ...
Tuesday, 13 December 22
COAL BASE RAMPS UP ENERGY SUPPLY FOR WINTER NEEDS - XINHUA
Inner Mongolia Autonomous Region, China’s leading coal production base, has kicked its production into high gear to meet heating needs as col ...
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- Holcim Trading Pte Ltd - Singapore
- Indika Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Oldendorff Carriers - Singapore
- Meralco Power Generation, Philippines
- Goldman Sachs - Singapore
- Anglo American - United Kingdom
- Lanco Infratech Ltd - India
- Mercator Lines Limited - India
- Coalindo Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- Salva Resources Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Ambuja Cements Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Madhucon Powers Ltd - India
- IEA Clean Coal Centre - UK
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- Merrill Lynch Commodities Europe
- Rio Tinto Coal - Australia
- Petron Corporation, Philippines
- Xindia Steels Limited - India
- Aboitiz Power Corporation - Philippines
- New Zealand Coal & Carbon
- PetroVietnam Power Coal Import and Supply Company
- GAC Shipping (India) Pvt Ltd
- Miang Besar Coal Terminal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Jindal Steel & Power Ltd - India
- Parry Sugars Refinery, India
- Toyota Tsusho Corporation, Japan
- The State Trading Corporation of India Ltd
- Bangladesh Power Developement Board
- Ministry of Transport, Egypt
- Mintek Dendrill Indonesia
- Carbofer General Trading SA - India
- Eastern Coal Council - USA
- India Bulls Power Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Posco Energy - South Korea
- European Bulk Services B.V. - Netherlands
- Parliament of New Zealand
- Gujarat Electricity Regulatory Commission - India
- Bharathi Cement Corporation - India
- McConnell Dowell - Australia
- Gujarat Sidhee Cement - India
- Semirara Mining and Power Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- Standard Chartered Bank - UAE
- Formosa Plastics Group - Taiwan
- Kaltim Prima Coal - Indonesia
- Coal and Oil Company - UAE
- Bayan Resources Tbk. - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Antam Resourcindo - Indonesia
- Pendopo Energi Batubara - Indonesia
- Sical Logistics Limited - India
- Alfred C Toepfer International GmbH - Germany
- Attock Cement Pakistan Limited
- Trasteel International SA, Italy
- Singapore Mercantile Exchange
- Bhoruka Overseas - Indonesia
- Semirara Mining Corp, Philippines
- Global Green Power PLC Corporation, Philippines
- Africa Commodities Group - South Africa
- Romanian Commodities Exchange
- AsiaOL BioFuels Corp., Philippines
- Metalloyd Limited - United Kingdom
- Kohat Cement Company Ltd. - Pakistan
- Tata Chemicals Ltd - India
- Energy Link Ltd, New Zealand
- Videocon Industries ltd - India
- IHS Mccloskey Coal Group - USA
- ICICI Bank Limited - India
- Binh Thuan Hamico - Vietnam
- Global Coal Blending Company Limited - Australia
- Riau Bara Harum - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Kartika Selabumi Mining - Indonesia
- Marubeni Corporation - India
- Economic Council, Georgia
- Karbindo Abesyapradhi - Indoneisa
- Bukit Makmur.PT - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Gujarat Mineral Development Corp Ltd - India
- Directorate Of Revenue Intelligence - India
- Edison Trading Spa - Italy
- Barasentosa Lestari - Indonesia
- Vizag Seaport Private Limited - India
- Kideco Jaya Agung - Indonesia
- The Treasury - Australian Government
- Indogreen Group - Indonesia
- Intertek Mineral Services - Indonesia
- London Commodity Brokers - England
- Price Waterhouse Coopers - Russia
- Krishnapatnam Port Company Ltd. - India
- Mercuria Energy - Indonesia
- Energy Development Corp, Philippines
- Chettinad Cement Corporation Ltd - India
- CIMB Investment Bank - Malaysia
- Planning Commission, India
- Interocean Group of Companies - India
- GMR Energy Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Thiess Contractors Indonesia
- San Jose City I Power Corp, Philippines
- Heidelberg Cement - Germany
- CNBM International Corporation - China
- Port Waratah Coal Services - Australia
- Wood Mackenzie - Singapore
- GVK Power & Infra Limited - India
- Makarim & Taira - Indonesia
- Orica Mining Services - Indonesia
- Global Business Power Corporation, Philippines
- Bhushan Steel Limited - India
- Maheswari Brothers Coal Limited - India
- Bukit Baiduri Energy - Indonesia
- Australian Commodity Traders Exchange
- Central Electricity Authority - India
- Sree Jayajothi Cements Limited - India
- Wilmar Investment Holdings
- ASAPP Information Group - India
- Simpson Spence & Young - Indonesia
- Larsen & Toubro Limited - India
- Eastern Energy - Thailand
- Banpu Public Company Limited - Thailand
- MS Steel International - UAE
- Medco Energi Mining Internasional
- Orica Australia Pty. Ltd.
- Agrawal Coal Company - India
- Power Finance Corporation Ltd., India
- Australian Coal Association
- Mjunction Services Limited - India
- Thai Mozambique Logistica
- PNOC Exploration Corporation - Philippines
- Ceylon Electricity Board - Sri Lanka
- SN Aboitiz Power Inc, Philippines
- Iligan Light & Power Inc, Philippines
- Commonwealth Bank - Australia
- Central Java Power - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Kobexindo Tractors - Indoneisa
- VISA Power Limited - India
- Cement Manufacturers Association - India
- Sojitz Corporation - Japan
- Electricity Authority, New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Sakthi Sugars Limited - India
- International Coal Ventures Pvt Ltd - India
- Dalmia Cement Bharat India
- Deloitte Consulting - India
- South Luzon Thermal Energy Corporation
- Georgia Ports Authority, United States
- Kalimantan Lumbung Energi - Indonesia
- LBH Netherlands Bv - Netherlands
- OPG Power Generation Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Latin American Coal - Colombia
- Sindya Power Generating Company Private Ltd
- Indian Energy Exchange, India
- Samtan Co., Ltd - South Korea
- The University of Queensland
- PTC India Limited - India
- Ministry of Finance - Indonesia
- White Energy Company Limited
- Karaikal Port Pvt Ltd - India
- Indonesian Coal Mining Association
- Ind-Barath Power Infra Limited - India
- Savvy Resources Ltd - HongKong
- Bahari Cakrawala Sebuku - Indonesia
- Therma Luzon, Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Uttam Galva Steels Limited - India
- Renaissance Capital - South Africa
- Minerals Council of Australia
- Electricity Generating Authority of Thailand
- Sarangani Energy Corporation, Philippines
- Borneo Indobara - Indonesia
- Indian Oil Corporation Limited
- Timah Investasi Mineral - Indoneisa
- PowerSource Philippines DevCo
- Kepco SPC Power Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Grasim Industreis Ltd - India
- Siam City Cement - Thailand
- Star Paper Mills Limited - India
- Rashtriya Ispat Nigam Limited - India
- Meenaskhi Energy Private Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Leighton Contractors Pty Ltd - Australia
- Asmin Koalindo Tuhup - Indonesia
- Malabar Cements Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Bulk Trading Sa - Switzerland
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Independent Power Producers Association of India
- Baramulti Group, Indonesia
- Aditya Birla Group - India
- Coastal Gujarat Power Limited - India
- Cigading International Bulk Terminal - Indonesia
- Siam City Cement PLC, Thailand
- Vedanta Resources Plc - India
- Bhatia International Limited - India
- Essar Steel Hazira Ltd - India
- Chamber of Mines of South Africa
- Manunggal Multi Energi - Indonesia
- Jaiprakash Power Ventures ltd
- Kumho Petrochemical, South Korea
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TNB Fuel Sdn Bhd - Malaysia
- SMC Global Power, Philippines
- Tamil Nadu electricity Board
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