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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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Friday, 17 January 14
DRY BULK MARKET ENDS DECLINE, BOUNCES BACK - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
It's been a rough start to the New Year for the dry bulk market, which was supposed to be on the verge of rallying to new heights this year, on the ...
Friday, 17 January 14
SPOT COAL PRICE TRENDS IN US VARY ACROSS KEY BASINS DURING 2013, SAYS EIA
COALspot.com: Spot steam coal price trends in US varied across key basins in 2013, a latest EIA report says. Compared with 2012, while total coal de ...
Thursday, 16 January 14
PANAMAX : THE GAP BETWEEN SPOT AND PERIOD HAS INCREASED IN BOTH HEMISPHERES - FEARNRESEARCH
Handy
In the Atlantic we have seen rates slowly sliding on lack of enough fresh business. USG/Continent still paying excess 28k and seems on an upw ...
Thursday, 16 January 14
SHIP OWNERS SCRAP 1,119 SHIPS DURING 2013 ON THE BACK OF OVERSUPPLY ISSUES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Scrapping of older vessels is still the best bet that ship owners can make, in order to improve their newer vessels' fortunes, amid an oversupply o ...
Wednesday, 15 January 14
KOREA MIDLAND POWER CO INVITES BIDS FOR 360K MT OF SUB-BITUMINOUS COAL FOR ITS BORYEONG PLANT
COALspot.com : Korea Midland Power Co., Ltd. has invited bids through International open bidding for 360,000 Metric Tons (MT) of sub-bituminous ...
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- McConnell Dowell - Australia
- Siam City Cement PLC, Thailand
- Rio Tinto Coal - Australia
- Kobexindo Tractors - Indoneisa
- Bhushan Steel Limited - India
- Parliament of New Zealand
- Neyveli Lignite Corporation Ltd, - India
- Savvy Resources Ltd - HongKong
- Intertek Mineral Services - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Standard Chartered Bank - UAE
- PTC India Limited - India
- Sindya Power Generating Company Private Ltd
- Latin American Coal - Colombia
- Bukit Baiduri Energy - Indonesia
- Cement Manufacturers Association - India
- Bulk Trading Sa - Switzerland
- OPG Power Generation Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Jindal Steel & Power Ltd - India
- International Coal Ventures Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Karaikal Port Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- India Bulls Power Limited - India
- Uttam Galva Steels Limited - India
- Meenaskhi Energy Private Limited - India
- Anglo American - United Kingdom
- Videocon Industries ltd - India
- VISA Power Limited - India
- Orica Mining Services - Indonesia
- Mercator Lines Limited - India
- GMR Energy Limited - India
- Central Electricity Authority - India
- Maheswari Brothers Coal Limited - India
- Mjunction Services Limited - India
- Directorate General of MIneral and Coal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Makarim & Taira - Indonesia
- Bhatia International Limited - India
- New Zealand Coal & Carbon
- Aditya Birla Group - India
- Price Waterhouse Coopers - Russia
- Carbofer General Trading SA - India
- IEA Clean Coal Centre - UK
- Madhucon Powers Ltd - India
- Salva Resources Pvt Ltd - India
- Medco Energi Mining Internasional
- PNOC Exploration Corporation - Philippines
- The State Trading Corporation of India Ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Baramulti Group, Indonesia
- Formosa Plastics Group - Taiwan
- GAC Shipping (India) Pvt Ltd
- Jorong Barutama Greston.PT - Indonesia
- Interocean Group of Companies - India
- Vizag Seaport Private Limited - India
- San Jose City I Power Corp, Philippines
- Wilmar Investment Holdings
- Sinarmas Energy and Mining - Indonesia
- Semirara Mining Corp, Philippines
- Chamber of Mines of South Africa
- Independent Power Producers Association of India
- Electricity Authority, New Zealand
- Electricity Generating Authority of Thailand
- Toyota Tsusho Corporation, Japan
- Pendopo Energi Batubara - Indonesia
- Posco Energy - South Korea
- Larsen & Toubro Limited - India
- Thai Mozambique Logistica
- Mintek Dendrill Indonesia
- LBH Netherlands Bv - Netherlands
- GN Power Mariveles Coal Plant, Philippines
- Africa Commodities Group - South Africa
- Coal and Oil Company - UAE
- Indo Tambangraya Megah - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Indonesian Coal Mining Association
- Petron Corporation, Philippines
- MS Steel International - UAE
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bangladesh Power Developement Board
- ASAPP Information Group - India
- Cigading International Bulk Terminal - Indonesia
- Wood Mackenzie - Singapore
- Samtan Co., Ltd - South Korea
- Oldendorff Carriers - Singapore
- London Commodity Brokers - England
- Marubeni Corporation - India
- Gujarat Mineral Development Corp Ltd - India
- Lanco Infratech Ltd - India
- Sakthi Sugars Limited - India
- Orica Australia Pty. Ltd.
- PowerSource Philippines DevCo
- Indika Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Straits Asia Resources Limited - Singapore
- Borneo Indobara - Indonesia
- Jaiprakash Power Ventures ltd
- Malabar Cements Ltd - India
- SMG Consultants - Indonesia
- Australian Coal Association
- Eastern Coal Council - USA
- Simpson Spence & Young - Indonesia
- Iligan Light & Power Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Vedanta Resources Plc - India
- Kumho Petrochemical, South Korea
- Sree Jayajothi Cements Limited - India
- Barasentosa Lestari - Indonesia
- Kepco SPC Power Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Ind-Barath Power Infra Limited - India
- Timah Investasi Mineral - Indoneisa
- Ministry of Transport, Egypt
- Indian Energy Exchange, India
- Merrill Lynch Commodities Europe
- Dalmia Cement Bharat India
- Tamil Nadu electricity Board
- SMC Global Power, Philippines
- Romanian Commodities Exchange
- Kaltim Prima Coal - Indonesia
- Economic Council, Georgia
- SN Aboitiz Power Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Coalindo Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Eastern Energy - Thailand
- Kideco Jaya Agung - Indonesia
- Aboitiz Power Corporation - Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Metalloyd Limited - United Kingdom
- South Luzon Thermal Energy Corporation
- Sical Logistics Limited - India
- White Energy Company Limited
- Petrochimia International Co. Ltd.- Taiwan
- Thiess Contractors Indonesia
- Ministry of Finance - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Rashtriya Ispat Nigam Limited - India
- Edison Trading Spa - Italy
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Essar Steel Hazira Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- The University of Queensland
- Heidelberg Cement - Germany
- Gujarat Electricity Regulatory Commission - India
- Gujarat Sidhee Cement - India
- Energy Link Ltd, New Zealand
- Star Paper Mills Limited - India
- Grasim Industreis Ltd - India
- Coastal Gujarat Power Limited - India
- Commonwealth Bank - Australia
- Semirara Mining and Power Corporation, Philippines
- CNBM International Corporation - China
- Alfred C Toepfer International GmbH - Germany
- Bayan Resources Tbk. - Indonesia
- Goldman Sachs - Singapore
- Tata Chemicals Ltd - India
- Kartika Selabumi Mining - Indonesia
- The Treasury - Australian Government
- TNB Fuel Sdn Bhd - Malaysia
- Trasteel International SA, Italy
- Minerals Council of Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Indogreen Group - Indonesia
- European Bulk Services B.V. - Netherlands
- Power Finance Corporation Ltd., India
- Indian Oil Corporation Limited
- Singapore Mercantile Exchange
- Krishnapatnam Port Company Ltd. - India
- Bukit Makmur.PT - Indonesia
- Sarangani Energy Corporation, Philippines
- Australian Commodity Traders Exchange
- Xindia Steels Limited - India
- TeaM Sual Corporation - Philippines
- Asmin Koalindo Tuhup - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ceylon Electricity Board - Sri Lanka
- Antam Resourcindo - Indonesia
- Global Coal Blending Company Limited - Australia
- Central Java Power - Indonesia
- Binh Thuan Hamico - Vietnam
- Miang Besar Coal Terminal - Indonesia
- IHS Mccloskey Coal Group - USA
- Billiton Holdings Pty Ltd - Australia
- PetroVietnam Power Coal Import and Supply Company
- Altura Mining Limited, Indonesia
- Globalindo Alam Lestari - Indonesia
- Ministry of Mines - Canada
- Renaissance Capital - South Africa
- Sojitz Corporation - Japan
- Siam City Cement - Thailand
- CIMB Investment Bank - Malaysia
- Bhoruka Overseas - Indonesia
- Parry Sugars Refinery, India
- Deloitte Consulting - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- ICICI Bank Limited - India
- GVK Power & Infra Limited - India
- Riau Bara Harum - Indonesia
- Global Business Power Corporation, Philippines
- Banpu Public Company Limited - Thailand
- Energy Development Corp, Philippines
- Ambuja Cements Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Planning Commission, India
- Port Waratah Coal Services - Australia
- Kalimantan Lumbung Energi - Indonesia
- Agrawal Coal Company - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Meralco Power Generation, Philippines
- Mercuria Energy - Indonesia
- Bharathi Cement Corporation - India
- Georgia Ports Authority, United States
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