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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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Wednesday, 16 July 14
WEEKLY SHIPPING MARKET INSIGHT - INTERMODAL
Wake me up when September ends - Theodore Ntalakos
Since last September most thought that the worst was behind us. It looks like the market de ...
Tuesday, 15 July 14
INDONESIA'S TOTAL COAL PRODUCTION REACHED ANOTHER HIGH DURING THE FIRST SIX MONTHS; GOVERNMENT EXPECTED TO RAISE ROYALTIES
COALspot.com: Indonesia's total coal production reached 213 million tons during January through June, up by 7.6 percent y-o-y. Coal output in I ...
Monday, 14 July 14
THE END OF THE ERA OF HEAVY FUEL OIL IN MARITIME SHIPPING - ICCT
KNOWLEDGE TO ELEVATE
Since the 1960s, heavy fuel oil (HFO) has been the king of marine fuels. Viscous, dirty, yet inexpensive and widely avail ...
Monday, 14 July 14
SGX SUB-BIT FOB INDONESIA COAL SWAP FOR Q4' 14 DELIVERY CLOSED AT $ 54.80
COALspot.com: Indonesian coal swaps for average Q3’ 2014 lost on day, week and on month according to AsiaClear OTC coal swap's reports re ...
Monday, 14 July 14
SGX CFR SOUTH CHINA COAL SWAP FOR Q3' 14 LOST 17.29% SINCE EARLY JANUARY 2014
COALspot.com: Coal price falling is continues as the impact oversupply and lower demand. API 8 CFR South China Coal swap for delivery in Q3 drops U ...
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- Indian Oil Corporation Limited
- India Bulls Power Limited - India
- Jindal Steel & Power Ltd - India
- Standard Chartered Bank - UAE
- Singapore Mercantile Exchange
- Videocon Industries ltd - India
- Salva Resources Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Timah Investasi Mineral - Indoneisa
- Carbofer General Trading SA - India
- Baramulti Group, Indonesia
- Mercuria Energy - Indonesia
- ICICI Bank Limited - India
- Vizag Seaport Private Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Ministry of Finance - Indonesia
- Trasteel International SA, Italy
- Siam City Cement - Thailand
- Gujarat Electricity Regulatory Commission - India
- Renaissance Capital - South Africa
- Xindia Steels Limited - India
- LBH Netherlands Bv - Netherlands
- IEA Clean Coal Centre - UK
- Sinarmas Energy and Mining - Indonesia
- Binh Thuan Hamico - Vietnam
- Bank of Tokyo Mitsubishi UFJ Ltd
- The University of Queensland
- Australian Commodity Traders Exchange
- Maheswari Brothers Coal Limited - India
- CIMB Investment Bank - Malaysia
- Ministry of Transport, Egypt
- Karbindo Abesyapradhi - Indoneisa
- Ambuja Cements Ltd - India
- Oldendorff Carriers - Singapore
- Karaikal Port Pvt Ltd - India
- Heidelberg Cement - Germany
- Sojitz Corporation - Japan
- Barasentosa Lestari - Indonesia
- Banpu Public Company Limited - Thailand
- Cement Manufacturers Association - India
- Posco Energy - South Korea
- Sindya Power Generating Company Private Ltd
- Sical Logistics Limited - India
- Altura Mining Limited, Indonesia
- Alfred C Toepfer International GmbH - Germany
- Pipit Mutiara Jaya. PT, Indonesia
- Iligan Light & Power Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Kartika Selabumi Mining - Indonesia
- International Coal Ventures Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kepco SPC Power Corporation, Philippines
- Larsen & Toubro Limited - India
- Kapuas Tunggal Persada - Indonesia
- Bharathi Cement Corporation - India
- Jaiprakash Power Ventures ltd
- Central Electricity Authority - India
- Neyveli Lignite Corporation Ltd, - India
- White Energy Company Limited
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Global Business Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Bukit Baiduri Energy - Indonesia
- Energy Development Corp, Philippines
- Billiton Holdings Pty Ltd - Australia
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- Wood Mackenzie - Singapore
- Bukit Makmur.PT - Indonesia
- Parliament of New Zealand
- Krishnapatnam Port Company Ltd. - India
- Samtan Co., Ltd - South Korea
- Economic Council, Georgia
- Therma Luzon, Inc, Philippines
- Riau Bara Harum - Indonesia
- Grasim Industreis Ltd - India
- Straits Asia Resources Limited - Singapore
- Globalindo Alam Lestari - Indonesia
- Intertek Mineral Services - Indonesia
- Commonwealth Bank - Australia
- Bayan Resources Tbk. - Indonesia
- Mintek Dendrill Indonesia
- Lanco Infratech Ltd - India
- Anglo American - United Kingdom
- Energy Link Ltd, New Zealand
- Aboitiz Power Corporation - Philippines
- Toyota Tsusho Corporation, Japan
- IHS Mccloskey Coal Group - USA
- Indian Energy Exchange, India
- CNBM International Corporation - China
- Vedanta Resources Plc - India
- Indonesian Coal Mining Association
- Sakthi Sugars Limited - India
- Holcim Trading Pte Ltd - Singapore
- Semirara Mining and Power Corporation, Philippines
- Latin American Coal - Colombia
- Savvy Resources Ltd - HongKong
- Chamber of Mines of South Africa
- Rio Tinto Coal - Australia
- Wilmar Investment Holdings
- Borneo Indobara - Indonesia
- McConnell Dowell - Australia
- The Treasury - Australian Government
- Bhatia International Limited - India
- Africa Commodities Group - South Africa
- Star Paper Mills Limited - India
- Formosa Plastics Group - Taiwan
- Marubeni Corporation - India
- Indo Tambangraya Megah - Indonesia
- Global Coal Blending Company Limited - Australia
- Antam Resourcindo - Indonesia
- Chettinad Cement Corporation Ltd - India
- GMR Energy Limited - India
- Thiess Contractors Indonesia
- Orica Mining Services - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Indogreen Group - Indonesia
- Port Waratah Coal Services - Australia
- Siam City Cement PLC, Thailand
- Electricity Generating Authority of Thailand
- San Jose City I Power Corp, Philippines
- Tamil Nadu electricity Board
- Meenaskhi Energy Private Limited - India
- Coal and Oil Company - UAE
- SMC Global Power, Philippines
- Indika Energy - Indonesia
- Mercator Lines Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Bhushan Steel Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Parry Sugars Refinery, India
- Bukit Asam (Persero) Tbk - Indonesia
- European Bulk Services B.V. - Netherlands
- TNB Fuel Sdn Bhd - Malaysia
- Mjunction Services Limited - India
- Coastal Gujarat Power Limited - India
- Directorate Of Revenue Intelligence - India
- Bhoruka Overseas - Indonesia
- Eastern Energy - Thailand
- PNOC Exploration Corporation - Philippines
- Central Java Power - Indonesia
- Attock Cement Pakistan Limited
- Merrill Lynch Commodities Europe
- Power Finance Corporation Ltd., India
- Minerals Council of Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Petrochimia International Co. Ltd.- Taiwan
- Electricity Authority, New Zealand
- GVK Power & Infra Limited - India
- Independent Power Producers Association of India
- Interocean Group of Companies - India
- Eastern Coal Council - USA
- Jorong Barutama Greston.PT - Indonesia
- OPG Power Generation Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Dalmia Cement Bharat India
- Kaltim Prima Coal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Semirara Mining Corp, Philippines
- Gujarat Sidhee Cement - India
- PTC India Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Goldman Sachs - Singapore
- Metalloyd Limited - United Kingdom
- Planning Commission, India
- Coalindo Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Malabar Cements Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- New Zealand Coal & Carbon
- Sarangani Energy Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Bulk Trading Sa - Switzerland
- Simpson Spence & Young - Indonesia
- Georgia Ports Authority, United States
- Kumho Petrochemical, South Korea
- Aditya Birla Group - India
- VISA Power Limited - India
- ASAPP Information Group - India
- Pendopo Energi Batubara - Indonesia
- Bangladesh Power Developement Board
- Tata Chemicals Ltd - India
- Ind-Barath Power Infra Limited - India
- Romanian Commodities Exchange
- Makarim & Taira - Indonesia
- The State Trading Corporation of India Ltd
- Leighton Contractors Pty Ltd - Australia
- Australian Coal Association
- Price Waterhouse Coopers - Russia
- Rashtriya Ispat Nigam Limited - India
- Meralco Power Generation, Philippines
- Thai Mozambique Logistica
- Essar Steel Hazira Ltd - India
- GAC Shipping (India) Pvt Ltd
- Deloitte Consulting - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- London Commodity Brokers - England
- TeaM Sual Corporation - Philippines
- MS Steel International - UAE
- Medco Energi Mining Internasional
- AsiaOL BioFuels Corp., Philippines
- Agrawal Coal Company - India
- Kideco Jaya Agung - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Orica Australia Pty. Ltd.
- Global Green Power PLC Corporation, Philippines
- Madhucon Powers Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Edison Trading Spa - Italy
- Sree Jayajothi Cements Limited - India
- Ceylon Electricity Board - Sri Lanka
- SN Aboitiz Power Inc, Philippines
- Petron Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- PowerSource Philippines DevCo
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