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Wednesday, 23 July 14
HARD COAL 2013: THE WORLD'S SECOND-MOST IMPORTANT ENERGY SOURCE AND GUARANTOR FOR THE SECURITY OF ENERGY SUPPLIES DURING TIMES OF CRISIS
 Hard coal is again in 2013 the fastest-growing fossil primary energy source in the world. As shown in the BP Statistical Review 2014, it covered about 30% of the world’s demand for primary energy of 12.7 billion TOE (tonnes of oil equivalent).
According to the German Federal Institute for Geosciences and Natural Resources (BGR), coal, which has a share of 56% of the reserves and about 89% of the resources of all fossil primary energy sources, has the greatest potential among all of the non-renewable energy sources and has been declared to be the most important energy source.
Hard coal is also broadly distributed over many regions, and calculations by the VDKi based on today’s quantities, prices, and costs indicate that there are sufficient quantities to last for at least another 110 years. Even if a significant coal-exporting country were to prohibit the export of coal tomorrow (speaking theoretically), producing countries on other continents would be able to compensate the loss without any problems.
The VDKi would like to call attention to the fact that the debate on the security of supply has become one-sided and closely focused on securing supply using primary energy sources tied to pipelines. The primary topic is the security of our electric power supply. Coal has a number of advantages in this respect. In contrast to renewable energies, it is available at all times. Moreover, it is not tied to pipeline facilities, can be stockpiled as an energy source right at power plant sites, is found all around the world, and there are many and varied means of transport across both the Atlantic and the Pacific Oceans.
Global hard coal consumption rises by 3%
According to initial estimates by BP in its Statistical Review 2014, global energy consumption of 12.7bn TOE (= tonne oil equivalent = 1 tonne OE = oil equivalent = 1.43 TCE) in 2013 rose by a little less than 2.3% in comparison with 2012 (12.5bn TOE). The background to this development is the low or non-existent growth in many OECD countries such as in Europe and Japan (with the exception of the USA). Coal consumption continued to increase in China (+4.4%) and India (+3.8%), on the other hand, although growth was more moderate than in previous years.
Coal consumption once again posted the strongest rise. In comparison with 2012, there was growth of 3%. The decline in coal consumption in the USA by 11.9% in 2012 was followed by growth of 4.3% in 2013. In terms of the average growth rates of 3.5% over the past five years, coal is and remains the Number 1 source of primary energy in the 21st century and has been the second-most important source of primary energy in the world since 2012, surpassed only by oil.
Estimates by the EU Commission indicate that total primary energy consumption in Europe declined by 0.6% (98m TOE) to 1.49bn TOE. The initial estimates indicate that there has been virtually no change in the mix of primary energy sources used for electric power generation in the EU 28. Hard coal and lignite together maintained their share of 27%, while hard coal alone posted a share of 19% in spite of the massive expansion of renewable energies. However, hard coal output in Europe declined by 15m tonnes to 114m tonnes. On the other hand, hard coal imports to the EU 28 rose by 3m tonnes (+1.4%) to 216m tonnes.
Seaborne world trade in steam coal grows by 6% World trade in hard coal totalling 1,237m tonnes in 2013 represented an increase of 73m tonnes (about 6%) in comparison with the previous year. Seaborne and internal trade posted the following development: in 2013, seaborne trade rose by 60m tonnes to 1,142m tonnes (= +5.5%), while internal trade increased by 18m tonnes (= +16%) to 95m tonnes. The steam coal market grew by 4% (37m tonnes) to a total of 863m tonnes.
Projections from the IEA show that the demand for coal will grow worldwide by an average of 2.3% p.a. over the coming years.
Preliminary calculations by the VDKi for the first four months of 2014 indicate that the seaborne hard coal market worldwide grew by just under 3% (10m tonnes) in comparison with the same period of the previous year.
Coking coal market grows by 9%
Worldwide crude steel production in 2013 reached the level of 1,607m tonnes, a new record. The increase by 3.5% (59m tonnes) occurred mainly in Asia (+6%) and in the Middle East (+2.5%). Crude steel production in Europe, North and South America, Russia and Korea declined by between 1.8% and 4.4%. Pig iron production, the decisive factor for the consumption of coking coal, PCI coal and coke, rose by 52m tonnes (about 5%) to 1,164m tonnes. The coking coal market increased correspondingly by 23m tonnes (+9%) to 279m tonnes.
With the exception of Australia, there were no fundamental changes in the supplier structure. Australia’s market share increased by another 8 percentage points and has now reached the mark of 61%. The USA again lost market share to Australia and now holds a share of 20%.
Hard coal and coke imports to Germany rise by 10%, hard coal consumption increases by 4%
The demand for domestic German and imported hard coal rose by 2.4m TCE (4.1%) to almost 61m TCE in 2013. About 86% of the demand for hard coal was covered by imports; domestic coal today covers only about 14%. Total imports of hard coal and coke reached a new record level of 52.8m tonnes in 2013, an increase by 4.9m tonnes (10%) over 2012.
Most of the hard coal sales go to power plants as the dominant buyers (71%; previous year 66%) and the iron and steel industry (26%; previous year 30%); the heating market (4%) plays only a subordinate role. The import demand for steam coal was covered primarily by Russia, the USA and Colombia, while the primary supplier countries for coking coal were Australia (45%) and the USA (30%).
Power generation from hard coal-fired power plants rose substantially in 2013 thanks to the favourable price situation in comparison with gas and the low CO2 certificate prices in European emission trading. Hard coal-fired power plants supplied 124 TWh of electric power, about 8 TWh (6.5%) more than in the past year, giving hard coal a share of more than 19% in the energy mix in 2013.
The balance in power exchange (total exports less imports) in 2013 amounted to about 34 TWh, an increase of 46% over 2012.
The price advantage of coal over gas (difference between the so-called clean dark spread less clean spark spread) in recent years has fluctuated between €-15 and €-25 per MWh. However, this difference favouring hard coal must not be allowed to obscure the fact that the revenues from power generation are inadequate because of the artificially low prices on the EEX and their unfair competitive advantage created by the priority given to feed-in of renewable energies.
A German hard coal-fired power plant has generation costs of between €50/MWH and €60/MWh, depending on its age. At the moment, however, it receives only about €35/MWh for the generated base load, i.e. it can usually achieve only very low contribution margins, if any at all, with the consequence that power revenues fall far short of covering the total operating costs.
This has prompted Dr Wolfgang Cieslik, VDKi CEO, to call on politicians for action:
“We urgently need a form of regulation which will guarantee hard coal-fired power plants a return to profitability in the long term as well because this is the only course which can guarantee the security and profitability of power supply and the successful realisation of the energy turnaround.”
Despite the increase in steam coal imports of 3.3% in Q1 2014, the VDKi estimates that only 37m tonnes of steam coal and 51m tonnes of hard coal and coke in total will be imported during all of 2014.
Price developments: A surplus in supply meets moderate demand
Developments in which a worldwide surplus in the supply of coal runs into demand which is not growing fast enough began in 2011, and the trend continued in 2013. Prices remained under pressure in 2013 as a result. From October 2013 to today (beginning of July 2014) alone, prices for steam coal fell from US$89/tonne to US$72/tonne, about 20%. The same is true of coking coal prices. Both coking coal and coke prices declined in 2013 because of the general slump in demand accompanied by a simultaneous expansion in supply.
While prices between US$160 and US$165/tonne were still being paid for coking coal at the beginning of 2013, this level had decreased to US$138/tonne by the end of 2013. This development continues to hold sway in 2014; as of the middle of 2014, spot prices for HCC quality had fallen to US$116/tonne.
- German Coal Importer Association -
About the German Coal Importer Association
The Verein der Kohlenimporteure e.V. (VDKi) is the lobby organisation for the hard coal import market in Germany. Its German and European members come from the sectors power, industry, trade and logistics. The Association currently has 78 members who consume about 70% of the German demand for hard coal of approximately 61 million tonnes in their facilities. The VDKi clearly represents the major part of the hard coal market (German domestic and imported hard coal) in Germany.
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Friday, 19 September 14
PRICES FOR DRY BULK CARRIERS HAVEN'T CORRECTED ENOUGH, DESPITE LOWER THAN EXPECTED FREIGHT RATES - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
A lot has been said and written about the looming dry bulk market recovery over the past few months. However, even if this hasn’t been materi ...
Thursday, 18 September 14
INDONESIA'S JULY COAL EXPORT VOLUME DROPPED 5.13% M-O-M
COALspot.com: Indonesia, one of the world's largest coal producer and the global leading multi grade coal exporter shipped around $1.65* ...
Thursday, 18 September 14
PANAMAX : US GULF/CHINA FRONTHAUL ARE NOW PAYING TYPICALLY 14.5K + 450K BB - FEARNRESEARCH
Handy
We still see a firming tendency in the Atlantic and it is still ECSA and USG leading on. USG/Cont now up in about USD 17/18k for a Smax whi ...
Thursday, 18 September 14
ELECTRONIC BILLS OF LADING: A GUIDE TO PAPERLESS TRADING WHICH HAS TAKEN THE SHIPPING INDUSTRY BY STORM
Bimco has recently developed and published a charter party clause that specifically addresses the use of electronic bills of lading. Increasing use ...
Wednesday, 17 September 14
PANAMAX: LIMITED INTEREST IN BOTH BASINS; RISING TONNAGE - INTERMODAL
With the week starting off at a fast pace and with the positive momentum from the previous Friday seemingly sticking around for a bit longer, most ...
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- Gujarat Sidhee Cement - India
- Baramulti Group, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Manunggal Multi Energi - Indonesia
- Energy Development Corp, Philippines
- Deloitte Consulting - India
- Pendopo Energi Batubara - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- VISA Power Limited - India
- LBH Netherlands Bv - Netherlands
- Makarim & Taira - Indonesia
- Australian Commodity Traders Exchange
- Riau Bara Harum - Indonesia
- Interocean Group of Companies - India
- GVK Power & Infra Limited - India
- Jaiprakash Power Ventures ltd
- PetroVietnam Power Coal Import and Supply Company
- Commonwealth Bank - Australia
- London Commodity Brokers - England
- Bulk Trading Sa - Switzerland
- Aboitiz Power Corporation - Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indogreen Group - Indonesia
- Timah Investasi Mineral - Indoneisa
- IEA Clean Coal Centre - UK
- Anglo American - United Kingdom
- Edison Trading Spa - Italy
- Cigading International Bulk Terminal - Indonesia
- McConnell Dowell - Australia
- Latin American Coal - Colombia
- Standard Chartered Bank - UAE
- Videocon Industries ltd - India
- Maheswari Brothers Coal Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Kobexindo Tractors - Indoneisa
- GMR Energy Limited - India
- Medco Energi Mining Internasional
- Sinarmas Energy and Mining - Indonesia
- Banpu Public Company Limited - Thailand
- Bharathi Cement Corporation - India
- Coastal Gujarat Power Limited - India
- Bukit Baiduri Energy - Indonesia
- Australian Coal Association
- International Coal Ventures Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Sindya Power Generating Company Private Ltd
- Meralco Power Generation, Philippines
- Romanian Commodities Exchange
- IHS Mccloskey Coal Group - USA
- Mjunction Services Limited - India
- Ceylon Electricity Board - Sri Lanka
- White Energy Company Limited
- Indo Tambangraya Megah - Indonesia
- Ind-Barath Power Infra Limited - India
- Binh Thuan Hamico - Vietnam
- Planning Commission, India
- Orica Mining Services - Indonesia
- SN Aboitiz Power Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Parry Sugars Refinery, India
- SMG Consultants - Indonesia
- The State Trading Corporation of India Ltd
- Jindal Steel & Power Ltd - India
- Ministry of Finance - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Global Green Power PLC Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Samtan Co., Ltd - South Korea
- Directorate Of Revenue Intelligence - India
- The University of Queensland
- Asmin Koalindo Tuhup - Indonesia
- Thai Mozambique Logistica
- Sarangani Energy Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- Sical Logistics Limited - India
- Toyota Tsusho Corporation, Japan
- Global Coal Blending Company Limited - Australia
- Oldendorff Carriers - Singapore
- TNB Fuel Sdn Bhd - Malaysia
- San Jose City I Power Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- Thiess Contractors Indonesia
- Agrawal Coal Company - India
- Electricity Generating Authority of Thailand
- Heidelberg Cement - Germany
- OPG Power Generation Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Essar Steel Hazira Ltd - India
- Barasentosa Lestari - Indonesia
- South Luzon Thermal Energy Corporation
- GN Power Mariveles Coal Plant, Philippines
- Bhatia International Limited - India
- Independent Power Producers Association of India
- Petrochimia International Co. Ltd.- Taiwan
- Kartika Selabumi Mining - Indonesia
- Miang Besar Coal Terminal - Indonesia
- SMC Global Power, Philippines
- Economic Council, Georgia
- MS Steel International - UAE
- Simpson Spence & Young - Indonesia
- Petron Corporation, Philippines
- Coalindo Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Africa Commodities Group - South Africa
- ICICI Bank Limited - India
- Central Java Power - Indonesia
- Power Finance Corporation Ltd., India
- Therma Luzon, Inc, Philippines
- Minerals Council of Australia
- Wood Mackenzie - Singapore
- Alfred C Toepfer International GmbH - Germany
- PTC India Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- The Treasury - Australian Government
- Port Waratah Coal Services - Australia
- Billiton Holdings Pty Ltd - Australia
- Indian Energy Exchange, India
- Xindia Steels Limited - India
- Parliament of New Zealand
- Uttam Galva Steels Limited - India
- Krishnapatnam Port Company Ltd. - India
- Indian Oil Corporation Limited
- Ambuja Cements Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vedanta Resources Plc - India
- Chettinad Cement Corporation Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Vijayanagar Sugar Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Goldman Sachs - Singapore
- AsiaOL BioFuels Corp., Philippines
- India Bulls Power Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Energy Link Ltd, New Zealand
- Attock Cement Pakistan Limited
- Singapore Mercantile Exchange
- Posco Energy - South Korea
- European Bulk Services B.V. - Netherlands
- Kideco Jaya Agung - Indonesia
- Sree Jayajothi Cements Limited - India
- Semirara Mining Corp, Philippines
- Bayan Resources Tbk. - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Lanco Infratech Ltd - India
- Mercuria Energy - Indonesia
- Cement Manufacturers Association - India
- New Zealand Coal & Carbon
- Bhoruka Overseas - Indonesia
- Aditya Birla Group - India
- Karaikal Port Pvt Ltd - India
- Ministry of Mines - Canada
- Georgia Ports Authority, United States
- Trasteel International SA, Italy
- Merrill Lynch Commodities Europe
- Star Paper Mills Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Rio Tinto Coal - Australia
- Savvy Resources Ltd - HongKong
- Mintek Dendrill Indonesia
- PowerSource Philippines DevCo
- Chamber of Mines of South Africa
- Coal and Oil Company - UAE
- Bangladesh Power Developement Board
- Siam City Cement - Thailand
- ASAPP Information Group - India
- Gujarat Mineral Development Corp Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Metalloyd Limited - United Kingdom
- Vizag Seaport Private Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Borneo Indobara - Indonesia
- Kumho Petrochemical, South Korea
- Larsen & Toubro Limited - India
- Salva Resources Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Ministry of Transport, Egypt
- Price Waterhouse Coopers - Russia
- Eastern Energy - Thailand
- Malabar Cements Ltd - India
- Mercator Lines Limited - India
- Tata Chemicals Ltd - India
- Dalmia Cement Bharat India
- Holcim Trading Pte Ltd - Singapore
- Leighton Contractors Pty Ltd - Australia
- Sakthi Sugars Limited - India
- Madhucon Powers Ltd - India
- Bukit Makmur.PT - Indonesia
- Renaissance Capital - South Africa
- Neyveli Lignite Corporation Ltd, - India
- Carbofer General Trading SA - India
- Kepco SPC Power Corporation, Philippines
- Indika Energy - Indonesia
- Orica Australia Pty. Ltd.
- Grasim Industreis Ltd - India
- Globalindo Alam Lestari - Indonesia
- Wilmar Investment Holdings
- Straits Asia Resources Limited - Singapore
- Indonesian Coal Mining Association
- Altura Mining Limited, Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhushan Steel Limited - India
- CIMB Investment Bank - Malaysia
- Global Business Power Corporation, Philippines
- CNBM International Corporation - China
- Electricity Authority, New Zealand
- Eastern Coal Council - USA
- Marubeni Corporation - India
- Formosa Plastics Group - Taiwan
- Tamil Nadu electricity Board
- GAC Shipping (India) Pvt Ltd
- Sojitz Corporation - Japan
- Iligan Light & Power Inc, Philippines
- TeaM Sual Corporation - Philippines
- Central Electricity Authority - India
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