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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$116/tonne.
- German Coal Importer Association -
About the German Coal Importer Association
The Verein der Kohlenimporteure e.V. (VDKi) is the lobby organisation for the hard coal import market in Germany. Its German and European members come from the sectors power, industry, trade and logistics. The Association currently has 78 members who consume about 70% of the German demand for hard coal of approximately 61 million tonnes in their facilities. The VDKi clearly represents the major part of the hard coal market (German domestic and imported hard coal) in Germany.
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Thursday, 28 August 14
PANAMAX: OWNERS CAN GET AROUND USD 16000 FOR A FRONTHAUL; PERIOD MARKET - VERY QUIET - FEARNLEYS
Handy
The activity and sentiment is improving in the Atlantic with the general TA rate is up about US$ 800 w-o-w. We see more South American carg ...
Thursday, 28 August 14
BANPU REPORTS HIGHER FIRST-HALF YEAR RESULTS FOR 2014
COALspot.com: Banpu Public Company Limited (BANPU) reports higher first half-year financial results for 2014 having its gross profit increasing 3 p ...
Wednesday, 27 August 14
FREIGHT MARKET: IS THE MARKET IN A RECOVERY MOOD? - GEORGE ILIOPOULOS
Is the market in a recovery mood?
August is typically a time when the shipping industry takes it easy… charter-ers book their requireme ...
Tuesday, 26 August 14
4TH ANNUAL ASIA NICKEL
4th Annual Asia Nickel
19-20 Nov 2014
Grand Hyatt Jakarta, Indonesia
Web Site
Asia’s Premier Nickel Conference
Regulation in ...
Tuesday, 26 August 14
DESPITE LOW DRY BULK RATES, BULKER PRICES ARE STILL HIGH - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Traditionally, August tends to be a month of slow activity in the sale and purchasing market and this year has been no exception. However, as shipb ...
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- Parliament of New Zealand
- Interocean Group of Companies - India
- Jaiprakash Power Ventures ltd
- Borneo Indobara - Indonesia
- Intertek Mineral Services - Indonesia
- Globalindo Alam Lestari - Indonesia
- Agrawal Coal Company - India
- Thai Mozambique Logistica
- Bank of Tokyo Mitsubishi UFJ Ltd
- Pendopo Energi Batubara - Indonesia
- Madhucon Powers Ltd - India
- Binh Thuan Hamico - Vietnam
- Alfred C Toepfer International GmbH - Germany
- Central Java Power - Indonesia
- Essar Steel Hazira Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ambuja Cements Ltd - India
- India Bulls Power Limited - India
- IEA Clean Coal Centre - UK
- SMG Consultants - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Kobexindo Tractors - Indoneisa
- Sakthi Sugars Limited - India
- Price Waterhouse Coopers - Russia
- Indo Tambangraya Megah - Indonesia
- Chettinad Cement Corporation Ltd - India
- Barasentosa Lestari - Indonesia
- Kumho Petrochemical, South Korea
- Altura Mining Limited, Indonesia
- Billiton Holdings Pty Ltd - Australia
- Bhushan Steel Limited - India
- New Zealand Coal & Carbon
- Riau Bara Harum - Indonesia
- Tata Chemicals Ltd - India
- Wood Mackenzie - Singapore
- PowerSource Philippines DevCo
- Vijayanagar Sugar Pvt Ltd - India
- SMC Global Power, Philippines
- ASAPP Information Group - India
- Toyota Tsusho Corporation, Japan
- Formosa Plastics Group - Taiwan
- Baramulti Group, Indonesia
- Mjunction Services Limited - India
- Semirara Mining and Power Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Siam City Cement - Thailand
- Coal and Oil Company - UAE
- Aditya Birla Group - India
- Sindya Power Generating Company Private Ltd
- Lanco Infratech Ltd - India
- Ministry of Transport, Egypt
- Bulk Trading Sa - Switzerland
- Eastern Energy - Thailand
- Global Business Power Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Maheswari Brothers Coal Limited - India
- Timah Investasi Mineral - Indoneisa
- Rashtriya Ispat Nigam Limited - India
- Videocon Industries ltd - India
- Dalmia Cement Bharat India
- Manunggal Multi Energi - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Energy Development Corp, Philippines
- Anglo American - United Kingdom
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Grasim Industreis Ltd - India
- European Bulk Services B.V. - Netherlands
- Romanian Commodities Exchange
- Directorate General of MIneral and Coal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Renaissance Capital - South Africa
- Parry Sugars Refinery, India
- Central Electricity Authority - India
- Coalindo Energy - Indonesia
- Ministry of Mines - Canada
- Jorong Barutama Greston.PT - Indonesia
- Africa Commodities Group - South Africa
- GMR Energy Limited - India
- Port Waratah Coal Services - Australia
- Malabar Cements Ltd - India
- MS Steel International - UAE
- Singapore Mercantile Exchange
- Petron Corporation, Philippines
- Sojitz Corporation - Japan
- Karaikal Port Pvt Ltd - India
- McConnell Dowell - Australia
- Jindal Steel & Power Ltd - India
- Bangladesh Power Developement Board
- Savvy Resources Ltd - HongKong
- Indian Oil Corporation Limited
- Offshore Bulk Terminal Pte Ltd, Singapore
- Straits Asia Resources Limited - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indonesian Coal Mining Association
- ICICI Bank Limited - India
- Independent Power Producers Association of India
- Bhoruka Overseas - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Eastern Coal Council - USA
- Kideco Jaya Agung - Indonesia
- International Coal Ventures Pvt Ltd - India
- Orica Mining Services - Indonesia
- Latin American Coal - Colombia
- Planning Commission, India
- Krishnapatnam Port Company Ltd. - India
- Pipit Mutiara Jaya. PT, Indonesia
- Medco Energi Mining Internasional
- Sical Logistics Limited - India
- Goldman Sachs - Singapore
- Kepco SPC Power Corporation, Philippines
- PTC India Limited - India
- Coastal Gujarat Power Limited - India
- Indogreen Group - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Standard Chartered Bank - UAE
- London Commodity Brokers - England
- Attock Cement Pakistan Limited
- PNOC Exploration Corporation - Philippines
- Sarangani Energy Corporation, Philippines
- Indika Energy - Indonesia
- Power Finance Corporation Ltd., India
- Gujarat Sidhee Cement - India
- Sinarmas Energy and Mining - Indonesia
- Bayan Resources Tbk. - Indonesia
- TeaM Sual Corporation - Philippines
- LBH Netherlands Bv - Netherlands
- Directorate Of Revenue Intelligence - India
- Oldendorff Carriers - Singapore
- Meenaskhi Energy Private Limited - India
- White Energy Company Limited
- Star Paper Mills Limited - India
- Bharathi Cement Corporation - India
- Trasteel International SA, Italy
- Vizag Seaport Private Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Energy Link Ltd, New Zealand
- Commonwealth Bank - Australia
- Siam City Cement PLC, Thailand
- Mercator Lines Limited - India
- Salva Resources Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Bhatia International Limited - India
- Thiess Contractors Indonesia
- Larsen & Toubro Limited - India
- The State Trading Corporation of India Ltd
- SN Aboitiz Power Inc, Philippines
- Banpu Public Company Limited - Thailand
- Merrill Lynch Commodities Europe
- Antam Resourcindo - Indonesia
- Therma Luzon, Inc, Philippines
- VISA Power Limited - India
- The University of Queensland
- Simpson Spence & Young - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Tamil Nadu electricity Board
- Mercuria Energy - Indonesia
- Ind-Barath Power Infra Limited - India
- Heidelberg Cement - Germany
- Marubeni Corporation - India
- Sree Jayajothi Cements Limited - India
- Minerals Council of Australia
- Uttam Galva Steels Limited - India
- Economic Council, Georgia
- Rio Tinto Coal - Australia
- Samtan Co., Ltd - South Korea
- Mintek Dendrill Indonesia
- Kapuas Tunggal Persada - Indonesia
- CNBM International Corporation - China
- CIMB Investment Bank - Malaysia
- Bukit Makmur.PT - Indonesia
- Australian Coal Association
- Xindia Steels Limited - India
- Electricity Generating Authority of Thailand
- Cement Manufacturers Association - India
- PetroVietnam Power Coal Import and Supply Company
- Kalimantan Lumbung Energi - Indonesia
- Bukit Baiduri Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Posco Energy - South Korea
- Australian Commodity Traders Exchange
- Aboitiz Power Corporation - Philippines
- IHS Mccloskey Coal Group - USA
- San Jose City I Power Corp, Philippines
- Kaltim Prima Coal - Indonesia
- Makarim & Taira - Indonesia
- Deloitte Consulting - India
- The Treasury - Australian Government
- Leighton Contractors Pty Ltd - Australia
- AsiaOL BioFuels Corp., Philippines
- Indian Energy Exchange, India
- GVK Power & Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- Meralco Power Generation, Philippines
- Iligan Light & Power Inc, Philippines
- Carbofer General Trading SA - India
- Bukit Asam (Persero) Tbk - Indonesia
- Vedanta Resources Plc - India
- Kohat Cement Company Ltd. - Pakistan
- Georgia Ports Authority, United States
- Chamber of Mines of South Africa
- Ministry of Finance - Indonesia
- Orica Australia Pty. Ltd.
- Edison Trading Spa - Italy
- Electricity Authority, New Zealand
- Global Coal Blending Company Limited - Australia
- South Luzon Thermal Energy Corporation
- Asmin Koalindo Tuhup - Indonesia
- Wilmar Investment Holdings
- Semirara Mining Corp, Philippines
- Metalloyd Limited - United Kingdom
- GAC Shipping (India) Pvt Ltd
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