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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, 13 December 13
HARD COAL : VOLUMES POSSIBLY AT RECORD-BREAKING HIGH; PRICES POSSIBLY AT A RECORD-BREAKING LOW - VDKI
Press Release : World Hard Coal Market 2013: volumes possibly at record-breaking high, prices possibly at a record-breaking low. German and UK impor ...
Friday, 13 December 13
DRY BULK SHIPPING TO WITNESS HEALTHY DEMAND MOVING FORWARD - ICS
The Institute of Chartered Shipbrokers Greek Branch organised its 9th Annual Forum at Eugenides Foundation, on Wednesday, 11th of December, with a r ...
Friday, 13 December 13
US PRODUCED APPROXIMATELY 18.4 MILLION SHORT TONS OF COAL W/E 7 DECEMBER 2013
COALspot.com – United States the world’s second largest coal producer, produced approximately 18.4 million short tons (mmst) of coal in ...
Thursday, 12 December 13
GREAT EXPECTATIONS SANCTIONED - EVA TZIMA
News that sanctions on Iranian oil exports could be lifted sometime in the following months have shaken the markets recently. One of the world&rsquo ...
Thursday, 12 December 13
DRY BULK MARKET RATES FOR CAPESIZES TO REMAIN VOLATILE SAYS BIMCO
The dry bulk market has reached multi year highs this week, as the BDI is standing at the 2,300-point mark. In its analysis of the market, BIMCO pre ...
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- Bhatia International Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Xindia Steels Limited - India
- Planning Commission, India
- Trasteel International SA, Italy
- Tata Chemicals Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Videocon Industries ltd - India
- Sree Jayajothi Cements Limited - India
- VISA Power Limited - India
- Kumho Petrochemical, South Korea
- Orica Mining Services - Indonesia
- Vedanta Resources Plc - India
- Samtan Co., Ltd - South Korea
- SMC Global Power, Philippines
- Kepco SPC Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Australian Coal Association
- Merrill Lynch Commodities Europe
- ICICI Bank Limited - India
- Parry Sugars Refinery, India
- Central Java Power - Indonesia
- Anglo American - United Kingdom
- Edison Trading Spa - Italy
- Rashtriya Ispat Nigam Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Binh Thuan Hamico - Vietnam
- Kaltim Prima Coal - Indonesia
- Indian Energy Exchange, India
- Bhoruka Overseas - Indonesia
- Meenaskhi Energy Private Limited - India
- IEA Clean Coal Centre - UK
- TeaM Sual Corporation - Philippines
- Ministry of Transport, Egypt
- Africa Commodities Group - South Africa
- Global Green Power PLC Corporation, Philippines
- Vizag Seaport Private Limited - India
- Alfred C Toepfer International GmbH - Germany
- Dalmia Cement Bharat India
- TNB Fuel Sdn Bhd - Malaysia
- European Bulk Services B.V. - Netherlands
- Coalindo Energy - Indonesia
- Standard Chartered Bank - UAE
- Krishnapatnam Port Company Ltd. - India
- Essar Steel Hazira Ltd - India
- Siam City Cement - Thailand
- Chettinad Cement Corporation Ltd - India
- Kobexindo Tractors - Indoneisa
- Eastern Coal Council - USA
- Lanco Infratech Ltd - India
- Mjunction Services Limited - India
- Grasim Industreis Ltd - India
- PowerSource Philippines DevCo
- Chamber of Mines of South Africa
- Directorate General of MIneral and Coal - Indonesia
- Siam City Cement PLC, Thailand
- Borneo Indobara - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Electricity Generating Authority of Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- New Zealand Coal & Carbon
- Kohat Cement Company Ltd. - Pakistan
- Sarangani Energy Corporation, Philippines
- Bulk Trading Sa - Switzerland
- Maharashtra Electricity Regulatory Commission - India
- Bahari Cakrawala Sebuku - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Directorate Of Revenue Intelligence - India
- Salva Resources Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Ministry of Finance - Indonesia
- London Commodity Brokers - England
- Globalindo Alam Lestari - Indonesia
- Straits Asia Resources Limited - Singapore
- Karaikal Port Pvt Ltd - India
- Orica Australia Pty. Ltd.
- LBH Netherlands Bv - Netherlands
- Medco Energi Mining Internasional
- Romanian Commodities Exchange
- GMR Energy Limited - India
- Barasentosa Lestari - Indonesia
- Altura Mining Limited, Indonesia
- Meralco Power Generation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- MS Steel International - UAE
- Commonwealth Bank - Australia
- GN Power Mariveles Coal Plant, Philippines
- Parliament of New Zealand
- Renaissance Capital - South Africa
- Deloitte Consulting - India
- McConnell Dowell - Australia
- Bukit Makmur.PT - Indonesia
- Energy Link Ltd, New Zealand
- SMG Consultants - Indonesia
- Uttam Galva Steels Limited - India
- Wilmar Investment Holdings
- White Energy Company Limited
- Billiton Holdings Pty Ltd - Australia
- Global Coal Blending Company Limited - Australia
- Banpu Public Company Limited - Thailand
- Antam Resourcindo - Indonesia
- Wood Mackenzie - Singapore
- Sakthi Sugars Limited - India
- Bayan Resources Tbk. - Indonesia
- Indo Tambangraya Megah - Indonesia
- Jaiprakash Power Ventures ltd
- Global Business Power Corporation, Philippines
- Ministry of Mines - Canada
- Indian Oil Corporation Limited
- Heidelberg Cement - Germany
- Electricity Authority, New Zealand
- Mintek Dendrill Indonesia
- Oldendorff Carriers - Singapore
- Indogreen Group - Indonesia
- Attock Cement Pakistan Limited
- Eastern Energy - Thailand
- The University of Queensland
- Petron Corporation, Philippines
- Thiess Contractors Indonesia
- Central Electricity Authority - India
- Aboitiz Power Corporation - Philippines
- Malabar Cements Ltd - India
- Thai Mozambique Logistica
- Mercuria Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Larsen & Toubro Limited - India
- Price Waterhouse Coopers - Russia
- The Treasury - Australian Government
- Bhushan Steel Limited - India
- ASAPP Information Group - India
- Economic Council, Georgia
- GVK Power & Infra Limited - India
- Energy Development Corp, Philippines
- Toyota Tsusho Corporation, Japan
- Aditya Birla Group - India
- San Jose City I Power Corp, Philippines
- Minerals Council of Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Cigading International Bulk Terminal - Indonesia
- Power Finance Corporation Ltd., India
- Singapore Mercantile Exchange
- CIMB Investment Bank - Malaysia
- Petrochimia International Co. Ltd.- Taiwan
- Ambuja Cements Ltd - India
- GAC Shipping (India) Pvt Ltd
- Sojitz Corporation - Japan
- Gujarat Electricity Regulatory Commission - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bangladesh Power Developement Board
- Port Waratah Coal Services - Australia
- Georgia Ports Authority, United States
- Miang Besar Coal Terminal - Indonesia
- Intertek Mineral Services - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Formosa Plastics Group - Taiwan
- Jindal Steel & Power Ltd - India
- Maheswari Brothers Coal Limited - India
- Timah Investasi Mineral - Indoneisa
- Latin American Coal - Colombia
- Star Paper Mills Limited - India
- Gujarat Sidhee Cement - India
- Karbindo Abesyapradhi - Indoneisa
- Coal and Oil Company - UAE
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Baramulti Group, Indonesia
- Simpson Spence & Young - Indonesia
- Manunggal Multi Energi - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Agrawal Coal Company - India
- Posco Energy - South Korea
- PTC India Limited - India
- Riau Bara Harum - Indonesia
- Kideco Jaya Agung - Indonesia
- Bukit Baiduri Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Carbofer General Trading SA - India
- Indonesian Coal Mining Association
- South Luzon Thermal Energy Corporation
- Leighton Contractors Pty Ltd - Australia
- Indika Energy - Indonesia
- Interocean Group of Companies - India
- SN Aboitiz Power Inc, Philippines
- Therma Luzon, Inc, Philippines
- Sical Logistics Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Madhucon Powers Ltd - India
- Independent Power Producers Association of India
- Marubeni Corporation - India
- Semirara Mining Corp, Philippines
- Kartika Selabumi Mining - Indonesia
- Mercator Lines Limited - India
- Goldman Sachs - Singapore
- Kapuas Tunggal Persada - Indonesia
- AsiaOL BioFuels Corp., Philippines
- IHS Mccloskey Coal Group - USA
- Metalloyd Limited - United Kingdom
- Neyveli Lignite Corporation Ltd, - India
- Tamil Nadu electricity Board
- Ind-Barath Power Infra Limited - India
- Makarim & Taira - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Bharathi Cement Corporation - India
- Rio Tinto Coal - Australia
- PNOC Exploration Corporation - Philippines
- Savvy Resources Ltd - HongKong
- Australian Commodity Traders Exchange
- The State Trading Corporation of India Ltd
- Cement Manufacturers Association - India
- Coastal Gujarat Power Limited - India
- India Bulls Power Limited - India
- CNBM International Corporation - China
- International Coal Ventures Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
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