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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, 24 June 24
PHILIPPINES COAL SUPPLY ENOUGH UNTIL 2030 - PHILSTAR GLOBAL
The country’s existing coal-fired power plants are sufficient to ensure enough base load capacity in the next six years, Energy Secretary Rap ...
Friday, 14 June 24
NEXTDECADE, SAUDI ARAMCO SIGN 20-YEAR LNG SUPPLY DEAL - REUTERS
U.S. liquefied natural gas (LNG) provider NextDecade has signed a non-binding agreement with Saudi Aramco 2222.SE to supply 1.2 million tonnes per ...
Friday, 14 June 24
NEWBUILDING PRICES CLIMB 3% TO HIGHEST LEVEL IN 16 YEARS - NIELS RASMUSSEN
“Since the start of the year, newbuilding prices have risen 3% to their highest level since 2008. Compared to their most recent low in late 2 ...
Friday, 14 June 24
INDIA TARGETS HIGHER DOMESTIC COAL PRODUCTION, REDUCED IMPORTS: GOVT - REUTERS
India wants to reduce coal imports and increase domestic production, federal coal minister G. Kishan Reddy said on Thursday.
The cou ...
Thursday, 13 June 24
US LNG TO ASIA FOR POWER GENERATION EXPECTED TO CUT EMISSIONS VERSUS COAL - RYSTAD ENERGY
The value-chain emissions of liquified natural gas (LNG) are lower on average than for coal-fired power generation, even when the fuel is shipp ...
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- Goldman Sachs - Singapore
- Renaissance Capital - South Africa
- Thai Mozambique Logistica
- Ministry of Mines - Canada
- Pendopo Energi Batubara - Indonesia
- Karaikal Port Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- IHS Mccloskey Coal Group - USA
- Indo Tambangraya Megah - Indonesia
- GMR Energy Limited - India
- South Luzon Thermal Energy Corporation
- Eastern Energy - Thailand
- Therma Luzon, Inc, Philippines
- SMC Global Power, Philippines
- Timah Investasi Mineral - Indoneisa
- Kideco Jaya Agung - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Bayan Resources Tbk. - Indonesia
- ICICI Bank Limited - India
- London Commodity Brokers - England
- Toyota Tsusho Corporation, Japan
- Posco Energy - South Korea
- The State Trading Corporation of India Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Electricity Authority, New Zealand
- Vedanta Resources Plc - India
- Bukit Makmur.PT - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Siam City Cement PLC, Thailand
- Altura Mining Limited, Indonesia
- Videocon Industries ltd - India
- Sindya Power Generating Company Private Ltd
- Power Finance Corporation Ltd., India
- GAC Shipping (India) Pvt Ltd
- Eastern Coal Council - USA
- Borneo Indobara - Indonesia
- Central Java Power - Indonesia
- Sical Logistics Limited - India
- New Zealand Coal & Carbon
- Rashtriya Ispat Nigam Limited - India
- Meralco Power Generation, Philippines
- Latin American Coal - Colombia
- Indonesian Coal Mining Association
- Manunggal Multi Energi - Indonesia
- Vizag Seaport Private Limited - India
- Heidelberg Cement - Germany
- Riau Bara Harum - Indonesia
- Sree Jayajothi Cements Limited - India
- SMG Consultants - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Intertek Mineral Services - Indonesia
- Ambuja Cements Ltd - India
- Sakthi Sugars Limited - India
- Meenaskhi Energy Private Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bulk Trading Sa - Switzerland
- CIMB Investment Bank - Malaysia
- TeaM Sual Corporation - Philippines
- Sinarmas Energy and Mining - Indonesia
- European Bulk Services B.V. - Netherlands
- Kartika Selabumi Mining - Indonesia
- White Energy Company Limited
- Bharathi Cement Corporation - India
- Attock Cement Pakistan Limited
- Australian Commodity Traders Exchange
- Energy Link Ltd, New Zealand
- Gujarat Electricity Regulatory Commission - India
- Maharashtra Electricity Regulatory Commission - India
- LBH Netherlands Bv - Netherlands
- Karbindo Abesyapradhi - Indoneisa
- Bukit Baiduri Energy - Indonesia
- Carbofer General Trading SA - India
- Wood Mackenzie - Singapore
- Central Electricity Authority - India
- Minerals Council of Australia
- Indogreen Group - Indonesia
- Sarangani Energy Corporation, Philippines
- Indika Energy - Indonesia
- VISA Power Limited - India
- OPG Power Generation Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Deloitte Consulting - India
- International Coal Ventures Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Standard Chartered Bank - UAE
- Tamil Nadu electricity Board
- Pipit Mutiara Jaya. PT, Indonesia
- Star Paper Mills Limited - India
- Leighton Contractors Pty Ltd - Australia
- McConnell Dowell - Australia
- Ind-Barath Power Infra Limited - India
- Kobexindo Tractors - Indoneisa
- San Jose City I Power Corp, Philippines
- Ceylon Electricity Board - Sri Lanka
- Coal and Oil Company - UAE
- SN Aboitiz Power Inc, Philippines
- Energy Development Corp, Philippines
- Mintek Dendrill Indonesia
- Orica Australia Pty. Ltd.
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Australian Coal Association
- Madhucon Powers Ltd - India
- Chamber of Mines of South Africa
- Mercator Lines Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Orica Mining Services - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Barasentosa Lestari - Indonesia
- Makarim & Taira - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Global Business Power Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- Bhatia International Limited - India
- Merrill Lynch Commodities Europe
- Interocean Group of Companies - India
- Tata Chemicals Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Coalindo Energy - Indonesia
- Parliament of New Zealand
- Trasteel International SA, Italy
- Electricity Generating Authority of Thailand
- Agrawal Coal Company - India
- Medco Energi Mining Internasional
- Mercuria Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Gujarat Sidhee Cement - India
- Bangladesh Power Developement Board
- The Treasury - Australian Government
- Wilmar Investment Holdings
- The University of Queensland
- Neyveli Lignite Corporation Ltd, - India
- Alfred C Toepfer International GmbH - Germany
- Larsen & Toubro Limited - India
- Binh Thuan Hamico - Vietnam
- Baramulti Group, Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Asmin Koalindo Tuhup - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Jorong Barutama Greston.PT - Indonesia
- Parry Sugars Refinery, India
- Kumho Petrochemical, South Korea
- Xindia Steels Limited - India
- Savvy Resources Ltd - HongKong
- Bukit Asam (Persero) Tbk - Indonesia
- Oldendorff Carriers - Singapore
- Simpson Spence & Young - Indonesia
- Samtan Co., Ltd - South Korea
- Essar Steel Hazira Ltd - India
- Jaiprakash Power Ventures ltd
- Straits Asia Resources Limited - Singapore
- Offshore Bulk Terminal Pte Ltd, Singapore
- Grasim Industreis Ltd - India
- Semirara Mining Corp, Philippines
- Antam Resourcindo - Indonesia
- PNOC Exploration Corporation - Philippines
- Independent Power Producers Association of India
- Dalmia Cement Bharat India
- Gujarat Mineral Development Corp Ltd - India
- Coastal Gujarat Power Limited - India
- Sojitz Corporation - Japan
- Marubeni Corporation - India
- Semirara Mining and Power Corporation, Philippines
- Edison Trading Spa - Italy
- MS Steel International - UAE
- Singapore Mercantile Exchange
- India Bulls Power Limited - India
- Banpu Public Company Limited - Thailand
- Romanian Commodities Exchange
- Directorate Of Revenue Intelligence - India
- PetroVietnam Power Coal Import and Supply Company
- Indian Energy Exchange, India
- Economic Council, Georgia
- Cement Manufacturers Association - India
- Aboitiz Power Corporation - Philippines
- Port Waratah Coal Services - Australia
- Kepco SPC Power Corporation, Philippines
- IEA Clean Coal Centre - UK
- PowerSource Philippines DevCo
- GVK Power & Infra Limited - India
- Cigading International Bulk Terminal - Indonesia
- Salva Resources Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Thiess Contractors Indonesia
- Anglo American - United Kingdom
- Rio Tinto Coal - Australia
- Africa Commodities Group - South Africa
- Price Waterhouse Coopers - Russia
- Bhushan Steel Limited - India
- Bhoruka Overseas - Indonesia
- Ministry of Finance - Indonesia
- Formosa Plastics Group - Taiwan
- Kaltim Prima Coal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Globalindo Alam Lestari - Indonesia
- Planning Commission, India
- ASAPP Information Group - India
- PTC India Limited - India
- Jindal Steel & Power Ltd - India
- Petron Corporation, Philippines
- Georgia Ports Authority, United States
- Commonwealth Bank - Australia
- Mjunction Services Limited - India
- Aditya Birla Group - India
- Kapuas Tunggal Persada - Indonesia
- Indian Oil Corporation Limited
- Ministry of Transport, Egypt
- Lanco Infratech Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Metalloyd Limited - United Kingdom
- Malabar Cements Ltd - India
- CNBM International Corporation - China
- Siam City Cement - Thailand
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