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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, 10 November 13
PANAMAX COAL FREIGHT RATES REMAIN UNDER PRESSURE; SUPRAMAX BIGGEST GAINER - REDDY
COALspot.com: The freight market was up this week with all indices increased except for Panamax index.
The BDI was up by 56 points closing at 158 ...
Friday, 08 November 13
DRY BULK MARKET BOUNCES BACK ON RENEWED DEMAND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market staged a mild comeback this week, as the industry's benchmark, the Baltic Dry Index (BDI) inched forward step by step and bit b ...
Friday, 08 November 13
US'S OCTOBER COAL PRODUCTION INCREASED BY 1.78% M-M - EIA
COALspot.com – United States the world’s second largest coal producer, produced approximately 19.3 million short tons (mmst) of coal in ...
Thursday, 07 November 13
FORMOSA PLASTICS SEEKS 80K MT OF 5850 GAR COAL
COALspot.com: Taiwan's Formosa Plastics Group is inviting bids for 80,000 mt of bituminous coal for delivery in Nov - Dec'13 for its Chi ...
Thursday, 07 November 13
INDONESIAN COAL EXPORT VOLUME INCREASED; REVENUE DECREASED
COALspot.com: Indonesia, the 15th largest economy, 4th largest coal producer in the world and world's largest multi grade coal exporter shipp ...
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- The State Trading Corporation of India Ltd
- Bukit Makmur.PT - Indonesia
- Siam City Cement - Thailand
- Rashtriya Ispat Nigam Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Chettinad Cement Corporation Ltd - India
- ASAPP Information Group - India
- Gujarat Electricity Regulatory Commission - India
- Mercator Lines Limited - India
- Port Waratah Coal Services - Australia
- Planning Commission, India
- Medco Energi Mining Internasional
- PNOC Exploration Corporation - Philippines
- Madhucon Powers Ltd - India
- Mercuria Energy - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Intertek Mineral Services - Indonesia
- Trasteel International SA, Italy
- Sarangani Energy Corporation, Philippines
- Uttam Galva Steels Limited - India
- Alfred C Toepfer International GmbH - Germany
- Price Waterhouse Coopers - Russia
- Meenaskhi Energy Private Limited - India
- Kideco Jaya Agung - Indonesia
- Australian Commodity Traders Exchange
- Eastern Coal Council - USA
- Baramulti Group, Indonesia
- Riau Bara Harum - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Global Business Power Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Parliament of New Zealand
- Savvy Resources Ltd - HongKong
- Electricity Authority, New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- McConnell Dowell - Australia
- Straits Asia Resources Limited - Singapore
- Gujarat Mineral Development Corp Ltd - India
- White Energy Company Limited
- Coal and Oil Company - UAE
- Aboitiz Power Corporation - Philippines
- Ambuja Cements Ltd - India
- Bhatia International Limited - India
- Aditya Birla Group - India
- Simpson Spence & Young - Indonesia
- Vizag Seaport Private Limited - India
- ICICI Bank Limited - India
- Borneo Indobara - Indonesia
- Toyota Tsusho Corporation, Japan
- Parry Sugars Refinery, India
- Power Finance Corporation Ltd., India
- Sinarmas Energy and Mining - Indonesia
- Wood Mackenzie - Singapore
- Merrill Lynch Commodities Europe
- Makarim & Taira - Indonesia
- Rio Tinto Coal - Australia
- New Zealand Coal & Carbon
- Xindia Steels Limited - India
- PTC India Limited - India
- Larsen & Toubro Limited - India
- Dalmia Cement Bharat India
- Minerals Council of Australia
- Indo Tambangraya Megah - Indonesia
- GMR Energy Limited - India
- Anglo American - United Kingdom
- Iligan Light & Power Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Africa Commodities Group - South Africa
- Petron Corporation, Philippines
- Bharathi Cement Corporation - India
- IHS Mccloskey Coal Group - USA
- GN Power Mariveles Coal Plant, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- European Bulk Services B.V. - Netherlands
- MS Steel International - UAE
- Bulk Trading Sa - Switzerland
- Leighton Contractors Pty Ltd - Australia
- Interocean Group of Companies - India
- Kartika Selabumi Mining - Indonesia
- Manunggal Multi Energi - Indonesia
- Directorate Of Revenue Intelligence - India
- GAC Shipping (India) Pvt Ltd
- Jindal Steel & Power Ltd - India
- India Bulls Power Limited - India
- Meralco Power Generation, Philippines
- Economic Council, Georgia
- Global Coal Blending Company Limited - Australia
- Gujarat Sidhee Cement - India
- Petrochimia International Co. Ltd.- Taiwan
- VISA Power Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Grasim Industreis Ltd - India
- Energy Link Ltd, New Zealand
- Kumho Petrochemical, South Korea
- Vedanta Resources Plc - India
- Global Green Power PLC Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Indian Energy Exchange, India
- Electricity Generating Authority of Thailand
- Maheswari Brothers Coal Limited - India
- Oldendorff Carriers - Singapore
- Semirara Mining Corp, Philippines
- Carbofer General Trading SA - India
- Ministry of Transport, Egypt
- Essar Steel Hazira Ltd - India
- Metalloyd Limited - United Kingdom
- Malabar Cements Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Sakthi Sugars Limited - India
- Ministry of Finance - Indonesia
- Independent Power Producers Association of India
- Mintek Dendrill Indonesia
- Timah Investasi Mineral - Indoneisa
- Deloitte Consulting - India
- Jaiprakash Power Ventures ltd
- Formosa Plastics Group - Taiwan
- AsiaOL BioFuels Corp., Philippines
- Sindya Power Generating Company Private Ltd
- Australian Coal Association
- Banpu Public Company Limited - Thailand
- Sree Jayajothi Cements Limited - India
- Thai Mozambique Logistica
- Cigading International Bulk Terminal - Indonesia
- Kaltim Prima Coal - Indonesia
- Eastern Energy - Thailand
- Marubeni Corporation - India
- London Commodity Brokers - England
- International Coal Ventures Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Sojitz Corporation - Japan
- Cement Manufacturers Association - India
- Ministry of Mines - Canada
- Sical Logistics Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Star Paper Mills Limited - India
- Commonwealth Bank - Australia
- Asmin Koalindo Tuhup - Indonesia
- Ind-Barath Power Infra Limited - India
- Central Java Power - Indonesia
- SN Aboitiz Power Inc, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Heidelberg Cement - Germany
- Orica Mining Services - Indonesia
- The Treasury - Australian Government
- Wilmar Investment Holdings
- PetroVietnam Power Coal Import and Supply Company
- Miang Besar Coal Terminal - Indonesia
- Bangladesh Power Developement Board
- Edison Trading Spa - Italy
- Bukit Baiduri Energy - Indonesia
- Lanco Infratech Ltd - India
- Standard Chartered Bank - UAE
- Bhushan Steel Limited - India
- TeaM Sual Corporation - Philippines
- Antam Resourcindo - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Indika Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- Tata Chemicals Ltd - India
- GVK Power & Infra Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Renaissance Capital - South Africa
- Bayan Resources Tbk. - Indonesia
- Salva Resources Pvt Ltd - India
- Siam City Cement PLC, Thailand
- SMC Global Power, Philippines
- Mjunction Services Limited - India
- Coastal Gujarat Power Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- CIMB Investment Bank - Malaysia
- Attock Cement Pakistan Limited
- SMG Consultants - Indonesia
- Central Electricity Authority - India
- Karaikal Port Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kobexindo Tractors - Indoneisa
- IEA Clean Coal Centre - UK
- Bhoruka Overseas - Indonesia
- Energy Development Corp, Philippines
- Altura Mining Limited, Indonesia
- PowerSource Philippines DevCo
- Coalindo Energy - Indonesia
- Kepco SPC Power Corporation, Philippines
- Posco Energy - South Korea
- Directorate General of MIneral and Coal - Indonesia
- Barasentosa Lestari - Indonesia
- Holcim Trading Pte Ltd - Singapore
- The University of Queensland
- Orica Australia Pty. Ltd.
- Thiess Contractors Indonesia
- Chamber of Mines of South Africa
- Romanian Commodities Exchange
- Indian Oil Corporation Limited
- TNB Fuel Sdn Bhd - Malaysia
- Indonesian Coal Mining Association
- Georgia Ports Authority, United States
- Krishnapatnam Port Company Ltd. - India
- Videocon Industries ltd - India
- Latin American Coal - Colombia
- South Luzon Thermal Energy Corporation
- Bahari Cakrawala Sebuku - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Therma Luzon, Inc, Philippines
- Singapore Mercantile Exchange
- Goldman Sachs - Singapore
- Pendopo Energi Batubara - Indonesia
- Tamil Nadu electricity Board
- Indogreen Group - Indonesia
- CNBM International Corporation - China
- LBH Netherlands Bv - Netherlands
- Binh Thuan Hamico - Vietnam
- Agrawal Coal Company - India
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