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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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Thursday, 09 January 14
CAPESIZE: WEST AUSTRALIA FREIGHT IS NOW DOWN IN THE $8S AND STILL DROPPING - FEARNLEYS
Handy
In the Atlantic we see rates sliding slowly for the start of 2014. Several players cvrd over the holidays and the rate decline was som ...
Thursday, 09 January 14
THE SHIPPING MARKET IN 2013 AND LOOKING FORWARD GLOBAL ECONOMY: STEADY AS SHE GOES UPWARDS - BIMCO
Over the past year, developed economies have gained traction while developing and emerging economies have suffered from slower growth. Despite key e ...
Wednesday, 08 January 14
DRY BULK MARKET PROSPECTS LOOKING BRIGHTER DESPITE SLOW START TO THE NEW YEAR - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Despite the fact that the dry bulk market's benchmark, the BDI has been on a fall since the start of 2014, ending yesterday's session down to 1,87 ...
Wednesday, 08 January 14
AUSTRALIAN NEWCASTLE PORT'S WEEKLY COAL EXPORTS FALL
COALspot.com: In the week ended January 6, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, totalled 3.27 m ...
Wednesday, 08 January 14
THE DRY BULK MARKET HAS LOST SOME OF ITS STEAM THESE PAST COUPLE OF DAYS: INTERMODAL
Chartering (Wet: Softer- / Dry: Softer- )
The Dry Bulk market has lost some of its steam these past couple of days although hires, espe ...
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- London Commodity Brokers - England
- Samtan Co., Ltd - South Korea
- Videocon Industries ltd - India
- Sakthi Sugars Limited - India
- Port Waratah Coal Services - Australia
- Cigading International Bulk Terminal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Parry Sugars Refinery, India
- Medco Energi Mining Internasional
- Sojitz Corporation - Japan
- Gujarat Sidhee Cement - India
- Eastern Energy - Thailand
- Sical Logistics Limited - India
- Essar Steel Hazira Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Global Business Power Corporation, Philippines
- The University of Queensland
- Tamil Nadu electricity Board
- Orica Mining Services - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Oldendorff Carriers - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Goldman Sachs - Singapore
- Kohat Cement Company Ltd. - Pakistan
- TNB Fuel Sdn Bhd - Malaysia
- Straits Asia Resources Limited - Singapore
- Renaissance Capital - South Africa
- Banpu Public Company Limited - Thailand
- Cement Manufacturers Association - India
- Ministry of Transport, Egypt
- Iligan Light & Power Inc, Philippines
- Bharathi Cement Corporation - India
- GAC Shipping (India) Pvt Ltd
- Bhushan Steel Limited - India
- Pendopo Energi Batubara - Indonesia
- Manunggal Multi Energi - Indonesia
- Global Coal Blending Company Limited - Australia
- Borneo Indobara - Indonesia
- CNBM International Corporation - China
- Bayan Resources Tbk. - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- The State Trading Corporation of India Ltd
- Agrawal Coal Company - India
- Wood Mackenzie - Singapore
- Aditya Birla Group - India
- Petron Corporation, Philippines
- Heidelberg Cement - Germany
- Neyveli Lignite Corporation Ltd, - India
- Riau Bara Harum - Indonesia
- Mercuria Energy - Indonesia
- Savvy Resources Ltd - HongKong
- Star Paper Mills Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Vedanta Resources Plc - India
- Planning Commission, India
- Parliament of New Zealand
- Timah Investasi Mineral - Indoneisa
- CIMB Investment Bank - Malaysia
- Electricity Authority, New Zealand
- Therma Luzon, Inc, Philippines
- Meralco Power Generation, Philippines
- PTC India Limited - India
- Bhatia International Limited - India
- Siam City Cement - Thailand
- Coal and Oil Company - UAE
- Marubeni Corporation - India
- Bukit Baiduri Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Central Java Power - Indonesia
- Indo Tambangraya Megah - Indonesia
- European Bulk Services B.V. - Netherlands
- Dalmia Cement Bharat India
- Offshore Bulk Terminal Pte Ltd, Singapore
- SN Aboitiz Power Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Kartika Selabumi Mining - Indonesia
- Grasim Industreis Ltd - India
- VISA Power Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- ASAPP Information Group - India
- Thiess Contractors Indonesia
- Bangladesh Power Developement Board
- Minerals Council of Australia
- Vijayanagar Sugar Pvt Ltd - India
- Indika Energy - Indonesia
- Uttam Galva Steels Limited - India
- McConnell Dowell - Australia
- San Jose City I Power Corp, Philippines
- Jaiprakash Power Ventures ltd
- Metalloyd Limited - United Kingdom
- Simpson Spence & Young - Indonesia
- Sindya Power Generating Company Private Ltd
- Gujarat Mineral Development Corp Ltd - India
- Romanian Commodities Exchange
- Chamber of Mines of South Africa
- GN Power Mariveles Coal Plant, Philippines
- Electricity Generating Authority of Thailand
- Salva Resources Pvt Ltd - India
- White Energy Company Limited
- Anglo American - United Kingdom
- Interocean Group of Companies - India
- Power Finance Corporation Ltd., India
- Globalindo Alam Lestari - Indonesia
- Commonwealth Bank - Australia
- South Luzon Thermal Energy Corporation
- Central Electricity Authority - India
- Merrill Lynch Commodities Europe
- Altura Mining Limited, Indonesia
- MS Steel International - UAE
- Malabar Cements Ltd - India
- Posco Energy - South Korea
- Ministry of Mines - Canada
- PetroVietnam Power Coal Import and Supply Company
- Xindia Steels Limited - India
- Kapuas Tunggal Persada - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- PowerSource Philippines DevCo
- Meenaskhi Energy Private Limited - India
- Indonesian Coal Mining Association
- New Zealand Coal & Carbon
- AsiaOL BioFuels Corp., Philippines
- Kepco SPC Power Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- India Bulls Power Limited - India
- Sarangani Energy Corporation, Philippines
- ICICI Bank Limited - India
- Gujarat Electricity Regulatory Commission - India
- Kaltim Prima Coal - Indonesia
- Global Green Power PLC Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Maheswari Brothers Coal Limited - India
- Intertek Mineral Services - Indonesia
- Wilmar Investment Holdings
- Independent Power Producers Association of India
- Asmin Koalindo Tuhup - Indonesia
- Orica Australia Pty. Ltd.
- Thai Mozambique Logistica
- Coastal Gujarat Power Limited - India
- Kumho Petrochemical, South Korea
- Mjunction Services Limited - India
- Makarim & Taira - Indonesia
- Deloitte Consulting - India
- Tata Chemicals Ltd - India
- Toyota Tsusho Corporation, Japan
- Standard Chartered Bank - UAE
- Australian Commodity Traders Exchange
- Larsen & Toubro Limited - India
- Ambuja Cements Ltd - India
- Energy Link Ltd, New Zealand
- Energy Development Corp, Philippines
- Ceylon Electricity Board - Sri Lanka
- Rio Tinto Coal - Australia
- Attock Cement Pakistan Limited
- International Coal Ventures Pvt Ltd - India
- The Treasury - Australian Government
- Vizag Seaport Private Limited - India
- Maharashtra Electricity Regulatory Commission - India
- PNOC Exploration Corporation - Philippines
- Georgia Ports Authority, United States
- GVK Power & Infra Limited - India
- Alfred C Toepfer International GmbH - Germany
- Ministry of Finance - Indonesia
- Africa Commodities Group - South Africa
- Carbofer General Trading SA - India
- Bukit Makmur.PT - Indonesia
- Edison Trading Spa - Italy
- Sree Jayajothi Cements Limited - India
- Mintek Dendrill Indonesia
- Miang Besar Coal Terminal - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Semirara Mining and Power Corporation, Philippines
- Latin American Coal - Colombia
- Economic Council, Georgia
- Singapore Mercantile Exchange
- Binh Thuan Hamico - Vietnam
- Ind-Barath Power Infra Limited - India
- Australian Coal Association
- Kalimantan Lumbung Energi - Indonesia
- Karaikal Port Pvt Ltd - India
- Eastern Coal Council - USA
- IHS Mccloskey Coal Group - USA
- Formosa Plastics Group - Taiwan
- Jindal Steel & Power Ltd - India
- Rashtriya Ispat Nigam Limited - India
- SMG Consultants - Indonesia
- Semirara Mining Corp, Philippines
- Coalindo Energy - Indonesia
- Indian Oil Corporation Limited
- Bukit Asam (Persero) Tbk - Indonesia
- TeaM Sual Corporation - Philippines
- Price Waterhouse Coopers - Russia
- Mercator Lines Limited - India
- Antam Resourcindo - Indonesia
- Madhucon Powers Ltd - India
- Barasentosa Lestari - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Billiton Holdings Pty Ltd - Australia
- IEA Clean Coal Centre - UK
- Aboitiz Power Corporation - Philippines
- Trasteel International SA, Italy
- Bulk Trading Sa - Switzerland
- Lanco Infratech Ltd - India
- Siam City Cement PLC, Thailand
- Indogreen Group - Indonesia
- Baramulti Group, Indonesia
- Chettinad Cement Corporation Ltd - India
- GMR Energy Limited - India
- Leighton Contractors Pty Ltd - Australia
- SMC Global Power, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- OPG Power Generation Pvt Ltd - India
- Indian Energy Exchange, India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhoruka Overseas - Indonesia
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