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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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Saturday, 12 October 13
PANAMAX: OWNERS ARE AT US$ 17-18.5K PER DAY; CHARTERERS ARE AT US$ 15.5-16K - CAPT. REDDY
COALspot.com - The futures market was heavily down on the cape size vessels and the physical average charterer rates on cape size vessels dropped by ...
Friday, 11 October 13
DRY BULK FREIGHT RATE POSITIVE MOMENTUM TO BE SUPPORTED BY HIGHER DEMAND SAYS BIMCO - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
BIMCO released its latest short term research on the shipping markets, estimating that the elevated level of Capesize TC average rates i ...
Friday, 11 October 13
US COAL PRODUCTION FALLS 7.70% IN SEPTEMBER
COALspot.com – United States the world’s second largest coal producer produced approximately 17.70 million short tons (mmst) of coal in ...
Thursday, 10 October 13
NPC AUSTRALIA SHIPPED 2.99 MILLION TONS OF COAL W-O-W
COALspot.com: Power plant and semi-soft coking coal shipments from Australia's Newcastle port up 12.04 per cent week on week to 2.99 million mt for ...
Thursday, 10 October 13
SEVERAL PANAMAX FIXTURES FOR 1 YEAR TC HAVE BEEN REPORTED AROUND $13.5K/DAY - FEARNRESEARCH
Handy
The market is not much fancy as several holidays in the Far East last week. Tonnage side seems tight in SE Asia but there are many of them in ...
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- Commonwealth Bank - Australia
- IEA Clean Coal Centre - UK
- Asmin Koalindo Tuhup - Indonesia
- Thiess Contractors Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Globalindo Alam Lestari - Indonesia
- Coastal Gujarat Power Limited - India
- Latin American Coal - Colombia
- Grasim Industreis Ltd - India
- Bulk Trading Sa - Switzerland
- Economic Council, Georgia
- Interocean Group of Companies - India
- Therma Luzon, Inc, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Eastern Energy - Thailand
- Karaikal Port Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Singapore Mercantile Exchange
- Electricity Authority, New Zealand
- IHS Mccloskey Coal Group - USA
- GAC Shipping (India) Pvt Ltd
- Renaissance Capital - South Africa
- Bayan Resources Tbk. - Indonesia
- London Commodity Brokers - England
- PetroVietnam Power Coal Import and Supply Company
- Binh Thuan Hamico - Vietnam
- Georgia Ports Authority, United States
- Kideco Jaya Agung - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Sojitz Corporation - Japan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jaiprakash Power Ventures ltd
- Salva Resources Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Samtan Co., Ltd - South Korea
- Siam City Cement - Thailand
- Price Waterhouse Coopers - Russia
- Tamil Nadu electricity Board
- The University of Queensland
- SMG Consultants - Indonesia
- Riau Bara Harum - Indonesia
- TeaM Sual Corporation - Philippines
- GMR Energy Limited - India
- Ministry of Mines - Canada
- Ind-Barath Power Infra Limited - India
- AsiaOL BioFuels Corp., Philippines
- Alfred C Toepfer International GmbH - Germany
- Bharathi Cement Corporation - India
- Iligan Light & Power Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Maheswari Brothers Coal Limited - India
- Semirara Mining Corp, Philippines
- Oldendorff Carriers - Singapore
- Standard Chartered Bank - UAE
- Jindal Steel & Power Ltd - India
- Central Electricity Authority - India
- CIMB Investment Bank - Malaysia
- San Jose City I Power Corp, Philippines
- The Treasury - Australian Government
- Parry Sugars Refinery, India
- Sinarmas Energy and Mining - Indonesia
- Simpson Spence & Young - Indonesia
- Aboitiz Power Corporation - Philippines
- Independent Power Producers Association of India
- Kalimantan Lumbung Energi - Indonesia
- Miang Besar Coal Terminal - Indonesia
- New Zealand Coal & Carbon
- Semirara Mining and Power Corporation, Philippines
- Trasteel International SA, Italy
- Merrill Lynch Commodities Europe
- Kartika Selabumi Mining - Indonesia
- Sindya Power Generating Company Private Ltd
- Antam Resourcindo - Indonesia
- Indo Tambangraya Megah - Indonesia
- Meenaskhi Energy Private Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Leighton Contractors Pty Ltd - Australia
- PNOC Exploration Corporation - Philippines
- Africa Commodities Group - South Africa
- Planning Commission, India
- Sical Logistics Limited - India
- Lanco Infratech Ltd - India
- Intertek Mineral Services - Indonesia
- Australian Coal Association
- ASAPP Information Group - India
- Agrawal Coal Company - India
- Ministry of Transport, Egypt
- Orica Australia Pty. Ltd.
- Altura Mining Limited, Indonesia
- Kapuas Tunggal Persada - Indonesia
- Vizag Seaport Private Limited - India
- Posco Energy - South Korea
- Global Green Power PLC Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Bhatia International Limited - India
- International Coal Ventures Pvt Ltd - India
- Port Waratah Coal Services - Australia
- VISA Power Limited - India
- Aditya Birla Group - India
- Indika Energy - Indonesia
- Siam City Cement PLC, Thailand
- Minerals Council of Australia
- Thai Mozambique Logistica
- Indogreen Group - Indonesia
- Heidelberg Cement - Germany
- Indian Oil Corporation Limited
- Madhucon Powers Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Kobexindo Tractors - Indoneisa
- LBH Netherlands Bv - Netherlands
- Goldman Sachs - Singapore
- Romanian Commodities Exchange
- Edison Trading Spa - Italy
- South Luzon Thermal Energy Corporation
- Anglo American - United Kingdom
- Straits Asia Resources Limited - Singapore
- Parliament of New Zealand
- Rio Tinto Coal - Australia
- Wood Mackenzie - Singapore
- Global Coal Blending Company Limited - Australia
- PTC India Limited - India
- Formosa Plastics Group - Taiwan
- Baramulti Group, Indonesia
- Orica Mining Services - Indonesia
- Kumho Petrochemical, South Korea
- PowerSource Philippines DevCo
- Pipit Mutiara Jaya. PT, Indonesia
- Bhoruka Overseas - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- India Bulls Power Limited - India
- Wilmar Investment Holdings
- Energy Development Corp, Philippines
- OPG Power Generation Pvt Ltd - India
- Bhushan Steel Limited - India
- Malabar Cements Ltd - India
- Holcim Trading Pte Ltd - Singapore
- ICICI Bank Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Kaltim Prima Coal - Indonesia
- Star Paper Mills Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Indian Energy Exchange, India
- McConnell Dowell - Australia
- SN Aboitiz Power Inc, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Xindia Steels Limited - India
- SMC Global Power, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Sarangani Energy Corporation, Philippines
- Tata Chemicals Ltd - India
- Essar Steel Hazira Ltd - India
- Bangladesh Power Developement Board
- Barasentosa Lestari - Indonesia
- Mintek Dendrill Indonesia
- Indonesian Coal Mining Association
- Larsen & Toubro Limited - India
- Medco Energi Mining Internasional
- Sree Jayajothi Cements Limited - India
- Mercuria Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Vedanta Resources Plc - India
- Dalmia Cement Bharat India
- Electricity Generating Authority of Thailand
- Directorate General of MIneral and Coal - Indonesia
- Ministry of Finance - Indonesia
- Timah Investasi Mineral - Indoneisa
- Sakthi Sugars Limited - India
- Gujarat Electricity Regulatory Commission - India
- Directorate Of Revenue Intelligence - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mercator Lines Limited - India
- Rashtriya Ispat Nigam Limited - India
- European Bulk Services B.V. - Netherlands
- Cement Manufacturers Association - India
- Chamber of Mines of South Africa
- Metalloyd Limited - United Kingdom
- Borneo Indobara - Indonesia
- Energy Link Ltd, New Zealand
- Australian Commodity Traders Exchange
- Meralco Power Generation, Philippines
- Petron Corporation, Philippines
- White Energy Company Limited
- Gujarat Mineral Development Corp Ltd - India
- Banpu Public Company Limited - Thailand
- Toyota Tsusho Corporation, Japan
- Bukit Baiduri Energy - Indonesia
- Gujarat Sidhee Cement - India
- Central Java Power - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- MS Steel International - UAE
- Makarim & Taira - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Coalindo Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- CNBM International Corporation - China
- Pendopo Energi Batubara - Indonesia
- Uttam Galva Steels Limited - India
- Coal and Oil Company - UAE
- Carbofer General Trading SA - India
- Ambuja Cements Ltd - India
- Chettinad Cement Corporation Ltd - India
- Deloitte Consulting - India
- Videocon Industries ltd - India
- GVK Power & Infra Limited - India
- Global Business Power Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Power Finance Corporation Ltd., India
- Ceylon Electricity Board - Sri Lanka
- Manunggal Multi Energi - Indonesia
- Marubeni Corporation - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Mjunction Services Limited - India
- Billiton Holdings Pty Ltd - Australia
- Eastern Coal Council - USA
- Savvy Resources Ltd - HongKong
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