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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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Sunday, 22 December 13
QUIET FREIGHT MARKET DUE TO LONG HOLIDAYS
COALspot.com: The market was soft this week with all indices down. However towards second half of the week the futures on segments was firming up.
...
Friday, 20 December 13
US PRODUCED 2.71% MORE COAL WEEK ON WEEK
COALspot.com – United States the world’s second largest coal producer, produced approximately 18.9 million short tons (mmst) of coal in ...
Friday, 20 December 13
DRY BULK MARKET SLUMPS AHEAD OF HOLIDAY SEASON - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
As has been the case in recent years, the dry bulk market has been on a downward trend ahead of the Holiday Season for a large part of the world. Th ...
Thursday, 19 December 13
SHIPPING CONFIDENCE HITS THREE-YEAR HIGH - MOORE STEPHENS
Overall confidence levels in the shipping industry rose to their highest level for more than three years over the three-month period to November 201 ...
Wednesday, 18 December 13
SNP ACTIVITY IN CHINA SEEMS TO BE SLOWING DOWN - CHRISTOS TRAGEAS
Approaching the end of the year, SnP activity in China seems to be slowing down in comparison to the first half of this quarter, as most Chinese Shi ...
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- Vizag Seaport Private Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Orica Mining Services - Indonesia
- Orica Australia Pty. Ltd.
- ASAPP Information Group - India
- Riau Bara Harum - Indonesia
- Manunggal Multi Energi - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- IEA Clean Coal Centre - UK
- Latin American Coal - Colombia
- Bayan Resources Tbk. - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Minerals Council of Australia
- Iligan Light & Power Inc, Philippines
- Ambuja Cements Ltd - India
- Toyota Tsusho Corporation, Japan
- Gujarat Mineral Development Corp Ltd - India
- Star Paper Mills Limited - India
- SMG Consultants - Indonesia
- Bhatia International Limited - India
- Meralco Power Generation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Leighton Contractors Pty Ltd - Australia
- The State Trading Corporation of India Ltd
- Kumho Petrochemical, South Korea
- Kalimantan Lumbung Energi - Indonesia
- Global Green Power PLC Corporation, Philippines
- Planning Commission, India
- Marubeni Corporation - India
- Standard Chartered Bank - UAE
- Semirara Mining Corp, Philippines
- Independent Power Producers Association of India
- Aboitiz Power Corporation - Philippines
- Mjunction Services Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bharathi Cement Corporation - India
- Heidelberg Cement - Germany
- Krishnapatnam Port Company Ltd. - India
- MS Steel International - UAE
- Port Waratah Coal Services - Australia
- Parliament of New Zealand
- PowerSource Philippines DevCo
- Parry Sugars Refinery, India
- Mercator Lines Limited - India
- Formosa Plastics Group - Taiwan
- Bulk Trading Sa - Switzerland
- Mercuria Energy - Indonesia
- Siam City Cement PLC, Thailand
- Deloitte Consulting - India
- The University of Queensland
- Vijayanagar Sugar Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Singapore Mercantile Exchange
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Vedanta Resources Plc - India
- CNBM International Corporation - China
- Coalindo Energy - Indonesia
- Price Waterhouse Coopers - Russia
- Edison Trading Spa - Italy
- Pendopo Energi Batubara - Indonesia
- Oldendorff Carriers - Singapore
- Ind-Barath Power Infra Limited - India
- AsiaOL BioFuels Corp., Philippines
- Eastern Coal Council - USA
- Australian Commodity Traders Exchange
- CIMB Investment Bank - Malaysia
- European Bulk Services B.V. - Netherlands
- Indian Oil Corporation Limited
- Romanian Commodities Exchange
- Tamil Nadu electricity Board
- Ministry of Mines - Canada
- International Coal Ventures Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Savvy Resources Ltd - HongKong
- Larsen & Toubro Limited - India
- Carbofer General Trading SA - India
- PetroVietnam Power Coal Import and Supply Company
- Bhushan Steel Limited - India
- Economic Council, Georgia
- Directorate General of MIneral and Coal - Indonesia
- Kepco SPC Power Corporation, Philippines
- Ministry of Transport, Egypt
- Banpu Public Company Limited - Thailand
- Electricity Generating Authority of Thailand
- Lanco Infratech Ltd - India
- SN Aboitiz Power Inc, Philippines
- Energy Link Ltd, New Zealand
- Kideco Jaya Agung - Indonesia
- Indonesian Coal Mining Association
- Pipit Mutiara Jaya. PT, Indonesia
- Directorate Of Revenue Intelligence - India
- Videocon Industries ltd - India
- Dalmia Cement Bharat India
- Eastern Energy - Thailand
- Chamber of Mines of South Africa
- Interocean Group of Companies - India
- Trasteel International SA, Italy
- Sindya Power Generating Company Private Ltd
- Thiess Contractors Indonesia
- VISA Power Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Kobexindo Tractors - Indoneisa
- Coastal Gujarat Power Limited - India
- Holcim Trading Pte Ltd - Singapore
- GMR Energy Limited - India
- Merrill Lynch Commodities Europe
- Gujarat Electricity Regulatory Commission - India
- Intertek Mineral Services - Indonesia
- Meenaskhi Energy Private Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Salva Resources Pvt Ltd - India
- McConnell Dowell - Australia
- Renaissance Capital - South Africa
- Essar Steel Hazira Ltd - India
- Central Java Power - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Mintek Dendrill Indonesia
- Makarim & Taira - Indonesia
- New Zealand Coal & Carbon
- Grasim Industreis Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Cement Manufacturers Association - India
- White Energy Company Limited
- ICICI Bank Limited - India
- Ministry of Finance - Indonesia
- Rio Tinto Coal - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Siam City Cement - Thailand
- Ceylon Electricity Board - Sri Lanka
- Indian Energy Exchange, India
- Africa Commodities Group - South Africa
- Sakthi Sugars Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Billiton Holdings Pty Ltd - Australia
- Metalloyd Limited - United Kingdom
- IHS Mccloskey Coal Group - USA
- Indogreen Group - Indonesia
- Medco Energi Mining Internasional
- London Commodity Brokers - England
- Altura Mining Limited, Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Central Electricity Authority - India
- Indika Energy - Indonesia
- Electricity Authority, New Zealand
- Anglo American - United Kingdom
- LBH Netherlands Bv - Netherlands
- Power Finance Corporation Ltd., India
- Jindal Steel & Power Ltd - India
- Kaltim Prima Coal - Indonesia
- Barasentosa Lestari - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Thai Mozambique Logistica
- Bangladesh Power Developement Board
- India Bulls Power Limited - India
- Xindia Steels Limited - India
- TeaM Sual Corporation - Philippines
- Jaiprakash Power Ventures ltd
- Globalindo Alam Lestari - Indonesia
- Georgia Ports Authority, United States
- Coal and Oil Company - UAE
- Petrochimia International Co. Ltd.- Taiwan
- South Luzon Thermal Energy Corporation
- SMC Global Power, Philippines
- Attock Cement Pakistan Limited
- Miang Besar Coal Terminal - Indonesia
- Indo Tambangraya Megah - Indonesia
- Malabar Cements Ltd - India
- The Treasury - Australian Government
- Karaikal Port Pvt Ltd - India
- Wilmar Investment Holdings
- Sinarmas Energy and Mining - Indonesia
- GVK Power & Infra Limited - India
- PTC India Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Gujarat Sidhee Cement - India
- Wood Mackenzie - Singapore
- Petron Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Commonwealth Bank - Australia
- Australian Coal Association
- Chettinad Cement Corporation Ltd - India
- Tata Chemicals Ltd - India
- Sical Logistics Limited - India
- Goldman Sachs - Singapore
- Sree Jayajothi Cements Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Rashtriya Ispat Nigam Limited - India
- Global Business Power Corporation, Philippines
- Sojitz Corporation - Japan
- Antam Resourcindo - Indonesia
- Posco Energy - South Korea
- Alfred C Toepfer International GmbH - Germany
- Sarangani Energy Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Kartika Selabumi Mining - Indonesia
- Baramulti Group, Indonesia
- Bhoruka Overseas - Indonesia
- San Jose City I Power Corp, Philippines
- Therma Luzon, Inc, Philippines
- Kapuas Tunggal Persada - Indonesia
- Uttam Galva Steels Limited - India
- Energy Development Corp, Philippines
- Agrawal Coal Company - India
- Maheswari Brothers Coal Limited - India
- Bukit Makmur.PT - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Madhucon Powers Ltd - India
- Borneo Indobara - Indonesia
- GAC Shipping (India) Pvt Ltd
- Timah Investasi Mineral - Indoneisa
- Aditya Birla Group - India
- Straits Asia Resources Limited - Singapore
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