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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, 27 January 14
Q3 2014 SUB-BIT INDONESIA COAL SWAP LOST GROUND, ENDS AT $60 PMT
COALspot.com – Sub-Bit Indonesia coal swap (FOB) for average Q1’ 14 delivery lost 2.29% pmt month on month on Friday 24 January 2014. Th ...
Sunday, 26 January 14
FREIGHT RATES FALL FURTHER ON LACK OF CARGOES - SOLYM CARRIERS
COALspot.com: The freight market has continued to soften further this week with BDI down by 12.31 pct. BDI was closed at 1,246 points week ended 24 ...
Friday, 24 January 14
US COAL PRODUCTION UP 3.9% ON WEEK IN WEEK ENDED SATURDAY - EIA
COALspot.com – United States the world’s second largest coal producer, produced approximately 19.1 million short tons (mmst) of coal in ...
Friday, 24 January 14
DRY BULK MARKET STRUGGLING TO FIND FIRM FOOTING IN START OF 2014 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has been faltering since the start of 2014, struggling to hold its ground as low seasonal demand has hindered further growth in ...
Thursday, 23 January 14
PANAMAX : THIS WEEK THE ACTIVITY CAME DOWN DRAMATICALLY - FEARNRESEARCH
Handy
With the Chinese New Year approaching the activity and rate levels are sliding in both hemispheres. Rates in the Atlantic have knocked off so ...
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- ICICI Bank Limited - India
- Power Finance Corporation Ltd., India
- Bhushan Steel Limited - India
- Tata Chemicals Ltd - India
- Siam City Cement PLC, Thailand
- Interocean Group of Companies - India
- Makarim & Taira - Indonesia
- Gujarat Sidhee Cement - India
- SMC Global Power, Philippines
- Bhoruka Overseas - Indonesia
- Therma Luzon, Inc, Philippines
- VISA Power Limited - India
- Straits Asia Resources Limited - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Tamil Nadu electricity Board
- Vizag Seaport Private Limited - India
- Altura Mining Limited, Indonesia
- Aboitiz Power Corporation - Philippines
- IEA Clean Coal Centre - UK
- Sinarmas Energy and Mining - Indonesia
- Ind-Barath Power Infra Limited - India
- Medco Energi Mining Internasional
- Meralco Power Generation, Philippines
- GMR Energy Limited - India
- Indian Energy Exchange, India
- Directorate Of Revenue Intelligence - India
- Ministry of Finance - Indonesia
- Mintek Dendrill Indonesia
- PTC India Limited - India
- Metalloyd Limited - United Kingdom
- Posco Energy - South Korea
- Sakthi Sugars Limited - India
- Standard Chartered Bank - UAE
- Coastal Gujarat Power Limited - India
- South Luzon Thermal Energy Corporation
- Oldendorff Carriers - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Toyota Tsusho Corporation, Japan
- Deloitte Consulting - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Asmin Koalindo Tuhup - Indonesia
- India Bulls Power Limited - India
- Commonwealth Bank - Australia
- Karbindo Abesyapradhi - Indoneisa
- Global Business Power Corporation, Philippines
- Parry Sugars Refinery, India
- Bangladesh Power Developement Board
- Ministry of Mines - Canada
- Kumho Petrochemical, South Korea
- Simpson Spence & Young - Indonesia
- The Treasury - Australian Government
- Savvy Resources Ltd - HongKong
- Malabar Cements Ltd - India
- Price Waterhouse Coopers - Russia
- Central Java Power - Indonesia
- Sindya Power Generating Company Private Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vijayanagar Sugar Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Lanco Infratech Ltd - India
- Global Coal Blending Company Limited - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Pendopo Energi Batubara - Indonesia
- Kaltim Prima Coal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Cement Manufacturers Association - India
- Vedanta Resources Plc - India
- White Energy Company Limited
- Electricity Generating Authority of Thailand
- Georgia Ports Authority, United States
- Samtan Co., Ltd - South Korea
- PowerSource Philippines DevCo
- Billiton Holdings Pty Ltd - Australia
- ASAPP Information Group - India
- Trasteel International SA, Italy
- Rio Tinto Coal - Australia
- Merrill Lynch Commodities Europe
- Indika Energy - Indonesia
- McConnell Dowell - Australia
- Independent Power Producers Association of India
- Bahari Cakrawala Sebuku - Indonesia
- Central Electricity Authority - India
- Wood Mackenzie - Singapore
- Minerals Council of Australia
- PNOC Exploration Corporation - Philippines
- Videocon Industries ltd - India
- GVK Power & Infra Limited - India
- Eastern Energy - Thailand
- Sical Logistics Limited - India
- Intertek Mineral Services - Indonesia
- Bulk Trading Sa - Switzerland
- Dalmia Cement Bharat India
- Anglo American - United Kingdom
- Gujarat Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- IHS Mccloskey Coal Group - USA
- AsiaOL BioFuels Corp., Philippines
- Semirara Mining and Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Edison Trading Spa - Italy
- Essar Steel Hazira Ltd - India
- Indogreen Group - Indonesia
- Kobexindo Tractors - Indoneisa
- Star Paper Mills Limited - India
- Coal and Oil Company - UAE
- Bukit Baiduri Energy - Indonesia
- London Commodity Brokers - England
- Jindal Steel & Power Ltd - India
- San Jose City I Power Corp, Philippines
- Singapore Mercantile Exchange
- Borneo Indobara - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Bharathi Cement Corporation - India
- Chamber of Mines of South Africa
- Thiess Contractors Indonesia
- Carbofer General Trading SA - India
- Antam Resourcindo - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Indian Oil Corporation Limited
- Renaissance Capital - South Africa
- Kideco Jaya Agung - Indonesia
- Baramulti Group, Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Latin American Coal - Colombia
- Planning Commission, India
- Global Green Power PLC Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Semirara Mining Corp, Philippines
- Banpu Public Company Limited - Thailand
- Kartika Selabumi Mining - Indonesia
- Maheswari Brothers Coal Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Neyveli Lignite Corporation Ltd, - India
- Madhucon Powers Ltd - India
- Binh Thuan Hamico - Vietnam
- Sree Jayajothi Cements Limited - India
- Orica Mining Services - Indonesia
- Goldman Sachs - Singapore
- Energy Development Corp, Philippines
- SN Aboitiz Power Inc, Philippines
- Kepco SPC Power Corporation, Philippines
- Ministry of Transport, Egypt
- Mercuria Energy - Indonesia
- Romanian Commodities Exchange
- Jaiprakash Power Ventures ltd
- Africa Commodities Group - South Africa
- CNBM International Corporation - China
- Port Waratah Coal Services - Australia
- TeaM Sual Corporation - Philippines
- New Zealand Coal & Carbon
- Parliament of New Zealand
- Directorate General of MIneral and Coal - Indonesia
- Uttam Galva Steels Limited - India
- Bhatia International Limited - India
- Orica Australia Pty. Ltd.
- Miang Besar Coal Terminal - Indonesia
- Indonesian Coal Mining Association
- Australian Commodity Traders Exchange
- Sojitz Corporation - Japan
- GN Power Mariveles Coal Plant, Philippines
- Electricity Authority, New Zealand
- Chettinad Cement Corporation Ltd - India
- Aditya Birla Group - India
- Karaikal Port Pvt Ltd - India
- Riau Bara Harum - Indonesia
- Larsen & Toubro Limited - India
- Bukit Makmur.PT - Indonesia
- CIMB Investment Bank - Malaysia
- Cigading International Bulk Terminal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Economic Council, Georgia
- Xindia Steels Limited - India
- OPG Power Generation Pvt Ltd - India
- Eastern Coal Council - USA
- Petron Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- Manunggal Multi Energi - Indonesia
- European Bulk Services B.V. - Netherlands
- Australian Coal Association
- SMG Consultants - Indonesia
- Wilmar Investment Holdings
- Heidelberg Cement - Germany
- TNB Fuel Sdn Bhd - Malaysia
- Maharashtra Electricity Regulatory Commission - India
- Bayan Resources Tbk. - Indonesia
- Timah Investasi Mineral - Indoneisa
- Grasim Industreis Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Globalindo Alam Lestari - Indonesia
- Ambuja Cements Ltd - India
- The University of Queensland
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Energy Link Ltd, New Zealand
- The State Trading Corporation of India Ltd
- Iligan Light & Power Inc, Philippines
- Kapuas Tunggal Persada - Indonesia
- Thai Mozambique Logistica
- MS Steel International - UAE
- Siam City Cement - Thailand
- Barasentosa Lestari - Indonesia
- International Coal Ventures Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Salva Resources Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Formosa Plastics Group - Taiwan
- Coalindo Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Agrawal Coal Company - India
- Alfred C Toepfer International GmbH - Germany
- Mercator Lines Limited - India
- Krishnapatnam Port Company Ltd. - India
- Marubeni Corporation - India
- Mjunction Services Limited - India
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