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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, 01 December 13
PANAMAX RATES HAVE REBOUNDED - CAPT. REDDY
COALspot.com: The freight market was quite firm last week with all the indices increased. Cape Index was gained highest this week which supports inc ...
Saturday, 30 November 13
NTPC STARTED IMPORTING COAL THROUGH NW1 FOR ITS FARAKKA POWER PLANT
COALspot.com: In a pioneering and path breaking operation, the very first consignment of about 69,060 metric tons of imported coal bought by MV HUAY ...
Friday, 29 November 13
DRY BULK MARKET BACK ON HIGHER GROUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market is strengthening as a result of higher demand for Capesize vessels. The BDI (Baltic Dry Index) was up by 146 points yesterday, e ...
Wednesday, 27 November 13
DRY SEGMENTS EXCEPTION OF PANAMAXES, REMAINED OVERALL STABLE - INTERMODAL
COALspot.com : The Dry Bulk market closed off the week in the red, albeit the decrease noted was of short scale. With the exception of Panamaxes, th ...
Wednesday, 27 November 13
US WHEAT IMPORTS TO BRAZIL, REACHED A 35 - YEAR HIGH - EVA TZIMA
COALspot.com: As I am going through a number of dry market fixtures reported since the beginning of October, my eyes instinctively stop where they d ...
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- Port Waratah Coal Services - Australia
- Grasim Industreis Ltd - India
- Sojitz Corporation - Japan
- Kalimantan Lumbung Energi - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Sarangani Energy Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Power Finance Corporation Ltd., India
- Meralco Power Generation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Parliament of New Zealand
- Georgia Ports Authority, United States
- Electricity Generating Authority of Thailand
- GAC Shipping (India) Pvt Ltd
- Bhatia International Limited - India
- Minerals Council of Australia
- Energy Development Corp, Philippines
- Tata Chemicals Ltd - India
- Lanco Infratech Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Ministry of Mines - Canada
- Star Paper Mills Limited - India
- Essar Steel Hazira Ltd - India
- OPG Power Generation Pvt Ltd - India
- PTC India Limited - India
- McConnell Dowell - Australia
- GN Power Mariveles Coal Plant, Philippines
- Maharashtra Electricity Regulatory Commission - India
- CIMB Investment Bank - Malaysia
- Anglo American - United Kingdom
- Gujarat Electricity Regulatory Commission - India
- Siam City Cement PLC, Thailand
- Cement Manufacturers Association - India
- Sakthi Sugars Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- The University of Queensland
- Toyota Tsusho Corporation, Japan
- Globalindo Alam Lestari - Indonesia
- SN Aboitiz Power Inc, Philippines
- Attock Cement Pakistan Limited
- Singapore Mercantile Exchange
- Riau Bara Harum - Indonesia
- PNOC Exploration Corporation - Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Vizag Seaport Private Limited - India
- GVK Power & Infra Limited - India
- VISA Power Limited - India
- London Commodity Brokers - England
- Aboitiz Power Corporation - Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Indian Energy Exchange, India
- Central Electricity Authority - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Africa Commodities Group - South Africa
- GMR Energy Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Asmin Koalindo Tuhup - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Alfred C Toepfer International GmbH - Germany
- Global Business Power Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Videocon Industries ltd - India
- Indonesian Coal Mining Association
- Manunggal Multi Energi - Indonesia
- Eastern Energy - Thailand
- European Bulk Services B.V. - Netherlands
- Romanian Commodities Exchange
- Banpu Public Company Limited - Thailand
- Deloitte Consulting - India
- Aditya Birla Group - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Posco Energy - South Korea
- Global Coal Blending Company Limited - Australia
- Simpson Spence & Young - Indonesia
- Mintek Dendrill Indonesia
- Sindya Power Generating Company Private Ltd
- Energy Link Ltd, New Zealand
- Ind-Barath Power Infra Limited - India
- LBH Netherlands Bv - Netherlands
- Kohat Cement Company Ltd. - Pakistan
- Jaiprakash Power Ventures ltd
- Jindal Steel & Power Ltd - India
- MS Steel International - UAE
- Independent Power Producers Association of India
- Eastern Coal Council - USA
- Gujarat Sidhee Cement - India
- Bhoruka Overseas - Indonesia
- Intertek Mineral Services - Indonesia
- Edison Trading Spa - Italy
- SMC Global Power, Philippines
- SMG Consultants - Indonesia
- Tamil Nadu electricity Board
- Formosa Plastics Group - Taiwan
- Medco Energi Mining Internasional
- Economic Council, Georgia
- Price Waterhouse Coopers - Russia
- Vedanta Resources Plc - India
- Commonwealth Bank - Australia
- San Jose City I Power Corp, Philippines
- Rashtriya Ispat Nigam Limited - India
- Ambuja Cements Ltd - India
- Salva Resources Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- The State Trading Corporation of India Ltd
- Agrawal Coal Company - India
- Heidelberg Cement - Germany
- Indogreen Group - Indonesia
- Ministry of Finance - Indonesia
- Xindia Steels Limited - India
- Merrill Lynch Commodities Europe
- Central Java Power - Indonesia
- Antam Resourcindo - Indonesia
- Siam City Cement - Thailand
- Binh Thuan Hamico - Vietnam
- Planning Commission, India
- Karaikal Port Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- CNBM International Corporation - China
- Latin American Coal - Colombia
- Sree Jayajothi Cements Limited - India
- Interocean Group of Companies - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indian Oil Corporation Limited
- Makarim & Taira - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Bukit Asam (Persero) Tbk - Indonesia
- Oldendorff Carriers - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Barasentosa Lestari - Indonesia
- Kobexindo Tractors - Indoneisa
- Parry Sugars Refinery, India
- Uttam Galva Steels Limited - India
- Mercator Lines Limited - India
- Indo Tambangraya Megah - Indonesia
- Wilmar Investment Holdings
- Thai Mozambique Logistica
- Leighton Contractors Pty Ltd - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Borneo Indobara - Indonesia
- India Bulls Power Limited - India
- IHS Mccloskey Coal Group - USA
- Coastal Gujarat Power Limited - India
- Bhushan Steel Limited - India
- AsiaOL BioFuels Corp., Philippines
- New Zealand Coal & Carbon
- Australian Coal Association
- Larsen & Toubro Limited - India
- Bulk Trading Sa - Switzerland
- Mjunction Services Limited - India
- Miang Besar Coal Terminal - Indonesia
- Meenaskhi Energy Private Limited - India
- Sical Logistics Limited - India
- Chamber of Mines of South Africa
- Coal and Oil Company - UAE
- Marubeni Corporation - India
- Semirara Mining and Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Altura Mining Limited, Indonesia
- TeaM Sual Corporation - Philippines
- Madhucon Powers Ltd - India
- Orica Australia Pty. Ltd.
- The Treasury - Australian Government
- Bukit Makmur.PT - Indonesia
- Standard Chartered Bank - UAE
- Savvy Resources Ltd - HongKong
- Global Green Power PLC Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Kartika Selabumi Mining - Indonesia
- ICICI Bank Limited - India
- South Luzon Thermal Energy Corporation
- Indika Energy - Indonesia
- Semirara Mining Corp, Philippines
- Malabar Cements Ltd - India
- ASAPP Information Group - India
- Thiess Contractors Indonesia
- Chettinad Cement Corporation Ltd - India
- Mercuria Energy - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- PowerSource Philippines DevCo
- Bukit Baiduri Energy - Indonesia
- Australian Commodity Traders Exchange
- Wood Mackenzie - Singapore
- Kapuas Tunggal Persada - Indonesia
- Petron Corporation, Philippines
- Baramulti Group, Indonesia
- Bangladesh Power Developement Board
- Ministry of Transport, Egypt
- Kideco Jaya Agung - Indonesia
- Bayan Resources Tbk. - Indonesia
- Directorate Of Revenue Intelligence - India
- Rio Tinto Coal - Australia
- Timah Investasi Mineral - Indoneisa
- Carbofer General Trading SA - India
- Samtan Co., Ltd - South Korea
- Dalmia Cement Bharat India
- White Energy Company Limited
- Kumho Petrochemical, South Korea
- Orica Mining Services - Indonesia
- Electricity Authority, New Zealand
- IEA Clean Coal Centre - UK
- Iligan Light & Power Inc, Philippines
- Goldman Sachs - Singapore
- Coalindo Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- Trasteel International SA, Italy
- Metalloyd Limited - United Kingdom
- Straits Asia Resources Limited - Singapore
- Bharathi Cement Corporation - India
- Kaltim Prima Coal - Indonesia
- Maheswari Brothers Coal Limited - India
- Renaissance Capital - South Africa
- Bahari Cakrawala Sebuku - Indonesia
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