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Friday, 21 February 14
INDONESIA COAL OUTPUT CAP TO HURT MINERS RELIANT ON VOLUME GROWTH, FITCH SAYS
 Fitch Ratings says that the credit profiles of mining sub-contractors and miners highly reliant on increasing volumes to support high debt servicing will be most affected if Indonesia strictly implements limits on thermal coal production. The Indonesian Ministry of Energy and Mineral Resources announced its plans to cap Indonesia's total coal output at 397m metric tonnes in 2014 - 6% lower than the 421m tonnes produced in 2013 - in an attempt to ensure Indonesia's long-term energy security and also on the expectation that a lower output may result in higher prices for its coal exports.
The announcement comes amidst some of the larger Indonesian miners announcing 2014 production targets that are up to 10% higher than their production in 2013. Mining companies have been seeking to increase production to partly compensate for substantially reduced dollar margins per tonne of coal following a steep decline in international seaborne thermal coal prices, especially those companies burdened with high debt levels and weak liquidity. For example, PT Bumi Resources Tbk expects to increase production from 74m tonnes in 2012 to about 100m tonnes in 2015.
Fitch understands that the higher production budgets of these miners have yet to be approved by the Ministry of Energy and Mineral Resources. Production caps are not new to Indonesia, although they have not been strictly applied before. How effectively the production caps are implemented, however, remains to be seen. The monitoring and control of production of those miners operating under coal contracts of work (CCOW), which are issued by the federal government, would be easier than that of mines operating under Mining Business Licences (IUPs), which are mostly issued by provincial governments. Indonesia's six largest miners account for about 50% of Indonesia's total coal production. Mines operating under CCOW concessions account for almost 80% of current production.
Fitch does not expect a 5%-10% production cut from 2013 levels to materially impact the credit profiles of miners with low financial leverage, such as PT Adaro Indonesia (BB+/Stable), PT Indo Tambangraya Mehgah Tbk, PT Harum Energy Tbk and PT Kideco Jaya Agung. Also, the operating cash generation of Indonesian coal miners is more sensitive to declines in prices than volumes due to a large variable cost structure. Moreover, the impact of lower output would be partly mitigated if the reduction in coal exports from Indonesia helps support seaborne coal prices. Fitch expects Asian coal markets to remain well supplied and any reduction of coal exports from Indonesia is likely to have only a very limited impact on coal prices, although it may alleviate any further downside pressure on prices. The 24m tonne reduction in production amounts to about 3% of global seaborne thermal coal volumes.
Fitch also says that the proposed production cap will negatively impact the business volumes of mining sub-contractors. An industry-wide coal production cap implemented during a weak price environment would likely lead some coal miners to continue mining at lower strip ratios (in areas that require less removal of overburden) for an extended period to enhance profitability. Apart from the decline in business volumes, the generally fixed prices per unit of overburden/coal extracted and their high operating leverage would render these companies more vulnerable to a reduction in coal volumes than the miners themselves. Over 70% of Indonesian coal mining and overburden removal volumes are done through sub-contracted miners.
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Friday, 07 March 14
INDONESIA TO PRODUCE 421 MMT OF COAL IN 2014
Coalspot.com: Indonesia finally agreed to increased 2014 coal output by as much as 6 percent to 421 million metric tons from its previous plan, a se ...
Friday, 07 March 14
US PRODUCED 19.4 MMST OF COAL IN PAST 7 DAYS, SAYS EIA
COALspot.com – United States the world’s second largest coal producer, produced approximately 19.4 million short tons (mmst) of coal in ...
Thursday, 06 March 14
PANAMAX MARKET IS STRUGGLING IN BOTH HEMISPHERES - FEARNRESEARCH
Handy
The Handy/Supra market experienced a rate increase in the Pacific. The activity itself is not too big, but spot tonnage is clearing up and ow ...
Wednesday, 05 March 14
THE BIG BULKERS HAVE IN FACT WITNESSED SIGNIFICANT IMPROVEMENTS IN BOTH BASINS
The BDI continues to gain back some of the lost ground, although in reality there isn't a lot to celebrate abou ...
Wednesday, 05 March 14
LEAVE IT TO CAPES TO CHANGE THE DIRECTION OF THE DRY BULK MARKET - INTERMODAL
Chartering (Wet: Stable- / Dry: Stable+)
Leave it to Capes to change the direction of the Dry Bulk market. The big bulkers managed to drag the BDI ...
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- Romanian Commodities Exchange
- Directorate General of MIneral and Coal - Indonesia
- GMR Energy Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Indonesian Coal Mining Association
- Karaikal Port Pvt Ltd - India
- Economic Council, Georgia
- SMG Consultants - Indonesia
- Attock Cement Pakistan Limited
- Aboitiz Power Corporation - Philippines
- GVK Power & Infra Limited - India
- Price Waterhouse Coopers - Russia
- Sindya Power Generating Company Private Ltd
- Carbofer General Trading SA - India
- Kaltim Prima Coal - Indonesia
- Ind-Barath Power Infra Limited - India
- Sakthi Sugars Limited - India
- Gujarat Electricity Regulatory Commission - India
- Ministry of Mines - Canada
- Simpson Spence & Young - Indonesia
- Commonwealth Bank - Australia
- Therma Luzon, Inc, Philippines
- PNOC Exploration Corporation - Philippines
- Timah Investasi Mineral - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Semirara Mining and Power Corporation, Philippines
- ASAPP Information Group - India
- Jindal Steel & Power Ltd - India
- Coastal Gujarat Power Limited - India
- Singapore Mercantile Exchange
- Rashtriya Ispat Nigam Limited - India
- GAC Shipping (India) Pvt Ltd
- Bulk Trading Sa - Switzerland
- Sree Jayajothi Cements Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- MS Steel International - UAE
- Alfred C Toepfer International GmbH - Germany
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhushan Steel Limited - India
- Kepco SPC Power Corporation, Philippines
- Thai Mozambique Logistica
- Anglo American - United Kingdom
- Indian Oil Corporation Limited
- Thiess Contractors Indonesia
- Electricity Generating Authority of Thailand
- Uttam Galva Steels Limited - India
- Vizag Seaport Private Limited - India
- Toyota Tsusho Corporation, Japan
- Eastern Coal Council - USA
- Leighton Contractors Pty Ltd - Australia
- Bukit Baiduri Energy - Indonesia
- Kumho Petrochemical, South Korea
- Chettinad Cement Corporation Ltd - India
- Jaiprakash Power Ventures ltd
- The University of Queensland
- Eastern Energy - Thailand
- Antam Resourcindo - Indonesia
- Altura Mining Limited, Indonesia
- Coalindo Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Directorate Of Revenue Intelligence - India
- Power Finance Corporation Ltd., India
- IHS Mccloskey Coal Group - USA
- Kalimantan Lumbung Energi - Indonesia
- Orica Mining Services - Indonesia
- Barasentosa Lestari - Indonesia
- CIMB Investment Bank - Malaysia
- Globalindo Alam Lestari - Indonesia
- The State Trading Corporation of India Ltd
- Baramulti Group, Indonesia
- Borneo Indobara - Indonesia
- Latin American Coal - Colombia
- Tata Chemicals Ltd - India
- Energy Link Ltd, New Zealand
- The Treasury - Australian Government
- Binh Thuan Hamico - Vietnam
- Parry Sugars Refinery, India
- Aditya Birla Group - India
- Goldman Sachs - Singapore
- Kohat Cement Company Ltd. - Pakistan
- SN Aboitiz Power Inc, Philippines
- Salva Resources Pvt Ltd - India
- Meralco Power Generation, Philippines
- Siam City Cement PLC, Thailand
- Indo Tambangraya Megah - Indonesia
- Medco Energi Mining Internasional
- PowerSource Philippines DevCo
- Asmin Koalindo Tuhup - Indonesia
- London Commodity Brokers - England
- Standard Chartered Bank - UAE
- Kapuas Tunggal Persada - Indonesia
- Malabar Cements Ltd - India
- Meenaskhi Energy Private Limited - India
- Essar Steel Hazira Ltd - India
- Dalmia Cement Bharat India
- Indogreen Group - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Star Paper Mills Limited - India
- Port Waratah Coal Services - Australia
- Central Electricity Authority - India
- Makarim & Taira - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Bukit Makmur.PT - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Cement Manufacturers Association - India
- Videocon Industries ltd - India
- Bhoruka Overseas - Indonesia
- South Luzon Thermal Energy Corporation
- Global Business Power Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Central Java Power - Indonesia
- India Bulls Power Limited - India
- Independent Power Producers Association of India
- Ambuja Cements Ltd - India
- Xindia Steels Limited - India
- Mintek Dendrill Indonesia
- Banpu Public Company Limited - Thailand
- Kobexindo Tractors - Indoneisa
- VISA Power Limited - India
- Krishnapatnam Port Company Ltd. - India
- Africa Commodities Group - South Africa
- Global Green Power PLC Corporation, Philippines
- Georgia Ports Authority, United States
- Heidelberg Cement - Germany
- Ministry of Transport, Egypt
- Offshore Bulk Terminal Pte Ltd, Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Formosa Plastics Group - Taiwan
- Billiton Holdings Pty Ltd - Australia
- Planning Commission, India
- Grasim Industreis Ltd - India
- Mjunction Services Limited - India
- Cigading International Bulk Terminal - Indonesia
- Semirara Mining Corp, Philippines
- Mercator Lines Limited - India
- Iligan Light & Power Inc, Philippines
- Agrawal Coal Company - India
- Ceylon Electricity Board - Sri Lanka
- Vedanta Resources Plc - India
- Sinarmas Energy and Mining - Indonesia
- Savvy Resources Ltd - HongKong
- Intertek Mineral Services - Indonesia
- Edison Trading Spa - Italy
- Parliament of New Zealand
- Electricity Authority, New Zealand
- PetroVietnam Power Coal Import and Supply Company
- Coal and Oil Company - UAE
- Marubeni Corporation - India
- Merrill Lynch Commodities Europe
- Wilmar Investment Holdings
- Tamil Nadu electricity Board
- Deloitte Consulting - India
- Interocean Group of Companies - India
- Karbindo Abesyapradhi - Indoneisa
- Kartika Selabumi Mining - Indonesia
- Bangladesh Power Developement Board
- Bhatia International Limited - India
- ICICI Bank Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Larsen & Toubro Limited - India
- Bharathi Cement Corporation - India
- Rio Tinto Coal - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- European Bulk Services B.V. - Netherlands
- CNBM International Corporation - China
- Manunggal Multi Energi - Indonesia
- PTC India Limited - India
- Sical Logistics Limited - India
- Oldendorff Carriers - Singapore
- TeaM Sual Corporation - Philippines
- White Energy Company Limited
- International Coal Ventures Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Petron Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Miang Besar Coal Terminal - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- OPG Power Generation Pvt Ltd - India
- Posco Energy - South Korea
- SMC Global Power, Philippines
- Orica Australia Pty. Ltd.
- IEA Clean Coal Centre - UK
- Indika Energy - Indonesia
- Sarangani Energy Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jorong Barutama Greston.PT - Indonesia
- Riau Bara Harum - Indonesia
- Renaissance Capital - South Africa
- Madhucon Powers Ltd - India
- Sojitz Corporation - Japan
- Indian Energy Exchange, India
- Australian Commodity Traders Exchange
- LBH Netherlands Bv - Netherlands
- Mercuria Energy - Indonesia
- Metalloyd Limited - United Kingdom
- Bayan Resources Tbk. - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Pendopo Energi Batubara - Indonesia
- Ministry of Finance - Indonesia
- Chamber of Mines of South Africa
- Trasteel International SA, Italy
- Australian Coal Association
- GN Power Mariveles Coal Plant, Philippines
- Maheswari Brothers Coal Limited - India
- Siam City Cement - Thailand
- Neyveli Lignite Corporation Ltd, - India
- New Zealand Coal & Carbon
- Wood Mackenzie - Singapore
- McConnell Dowell - Australia
- San Jose City I Power Corp, Philippines
- Samtan Co., Ltd - South Korea
- Minerals Council of Australia
- Energy Development Corp, Philippines
- Lanco Infratech Ltd - India
- Straits Asia Resources Limited - Singapore
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