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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$116/tonne.
- German Coal Importer Association -
About the German Coal Importer Association
The Verein der Kohlenimporteure e.V. (VDKi) is the lobby organisation for the hard coal import market in Germany. Its German and European members come from the sectors power, industry, trade and logistics. The Association currently has 78 members who consume about 70% of the German demand for hard coal of approximately 61 million tonnes in their facilities. The VDKi clearly represents the major part of the hard coal market (German domestic and imported hard coal) in Germany.
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Tuesday, 20 May 14
NEWCASTLE'S COAL EXPORT VOLUME UP 39.11 PERCENT WEEK ON WEEK
COALspot.com: In the week ended 07:00 hours 19 May 2014, power plant and semi-soft coking coal shipments from the port of Newcastle in Queensland, ...
Tuesday, 20 May 14
DRY BULK MARKET TO IMPROVE OVER THE COURSE OF 2014, BUT OVERSUPPLY STILL AN ISSUE SAYS BIMCO'S CHIEF SHIPPING ANALYST
As a gruelling first quarter edges closer to the end, dry bulk ship owners are looking at an improved second quarter demand, which, coupled with sl ...
Tuesday, 20 May 14
DRY BULK MARKET IS BOUND FOR A RECOVERY CLAIMS PARAGON SHIPPING'S HEAD MICHAEL BODOUROGLOU
The dry bulk market is bound for a recovery in the coming weeks, as the market will be better balanced, said Mr. Michael Bodouroglou, Chairman and ...
Monday, 19 May 14
INDO COAL SWAPS FOR AVERAGE Q3' 2014 DELIVERY LOST ON WEEK AND ON MONTH
COALspot.com: Indonesian coal swaps for average Q3’ 2014 lost on week and on month according to AsiaClear OTC coal swap's reports release ...
Monday, 19 May 14
API 8 CFR SOUTH CHINA COAL LOST 2.49% MONTH ON MONTH
COALspot.com: API 8 CFR South China Coal swaps for average Q3 14 deliveries lost 2.49 percent month on month and closed at US$ 74.35 per mt as on F ...
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- Bukit Baiduri Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- Port Waratah Coal Services - Australia
- Central Java Power - Indonesia
- Aditya Birla Group - India
- Krishnapatnam Port Company Ltd. - India
- Australian Coal Association
- Indian Energy Exchange, India
- San Jose City I Power Corp, Philippines
- Manunggal Multi Energi - Indonesia
- Borneo Indobara - Indonesia
- OPG Power Generation Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Rio Tinto Coal - Australia
- India Bulls Power Limited - India
- Indo Tambangraya Megah - Indonesia
- Indogreen Group - Indonesia
- CNBM International Corporation - China
- Energy Development Corp, Philippines
- Africa Commodities Group - South Africa
- Directorate Of Revenue Intelligence - India
- Mercuria Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Electricity Authority, New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- Marubeni Corporation - India
- TeaM Sual Corporation - Philippines
- Semirara Mining Corp, Philippines
- Lanco Infratech Ltd - India
- Ministry of Transport, Egypt
- The University of Queensland
- Larsen & Toubro Limited - India
- Leighton Contractors Pty Ltd - Australia
- Sojitz Corporation - Japan
- Mintek Dendrill Indonesia
- SMG Consultants - Indonesia
- Edison Trading Spa - Italy
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Karaikal Port Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Baramulti Group, Indonesia
- Carbofer General Trading SA - India
- Formosa Plastics Group - Taiwan
- Timah Investasi Mineral - Indoneisa
- Renaissance Capital - South Africa
- Salva Resources Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Barasentosa Lestari - Indonesia
- Bukit Makmur.PT - Indonesia
- Deloitte Consulting - India
- Commonwealth Bank - Australia
- Sinarmas Energy and Mining - Indonesia
- Bulk Trading Sa - Switzerland
- The Treasury - Australian Government
- Pipit Mutiara Jaya. PT, Indonesia
- Latin American Coal - Colombia
- Sarangani Energy Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Directorate General of MIneral and Coal - Indonesia
- Kaltim Prima Coal - Indonesia
- Standard Chartered Bank - UAE
- Semirara Mining and Power Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Rashtriya Ispat Nigam Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GN Power Mariveles Coal Plant, Philippines
- Metalloyd Limited - United Kingdom
- Riau Bara Harum - Indonesia
- Global Green Power PLC Corporation, Philippines
- Jindal Steel & Power Ltd - India
- Antam Resourcindo - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Jaiprakash Power Ventures ltd
- Toyota Tsusho Corporation, Japan
- PNOC Exploration Corporation - Philippines
- Coal and Oil Company - UAE
- Essar Steel Hazira Ltd - India
- Bhushan Steel Limited - India
- Malabar Cements Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Samtan Co., Ltd - South Korea
- Siam City Cement - Thailand
- Petron Corporation, Philippines
- Merrill Lynch Commodities Europe
- White Energy Company Limited
- Videocon Industries ltd - India
- ICICI Bank Limited - India
- Alfred C Toepfer International GmbH - Germany
- CIMB Investment Bank - Malaysia
- Georgia Ports Authority, United States
- Indika Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- Madhucon Powers Ltd - India
- Thai Mozambique Logistica
- Binh Thuan Hamico - Vietnam
- Sindya Power Generating Company Private Ltd
- Electricity Generating Authority of Thailand
- Maheswari Brothers Coal Limited - India
- Gujarat Sidhee Cement - India
- Billiton Holdings Pty Ltd - Australia
- Agrawal Coal Company - India
- Vijayanagar Sugar Pvt Ltd - India
- Orica Mining Services - Indonesia
- SMC Global Power, Philippines
- Coalindo Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- Economic Council, Georgia
- MS Steel International - UAE
- Singapore Mercantile Exchange
- European Bulk Services B.V. - Netherlands
- New Zealand Coal & Carbon
- Global Business Power Corporation, Philippines
- Power Finance Corporation Ltd., India
- Ceylon Electricity Board - Sri Lanka
- Bayan Resources Tbk. - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Savvy Resources Ltd - HongKong
- Oldendorff Carriers - Singapore
- Goldman Sachs - Singapore
- Uttam Galva Steels Limited - India
- Xindia Steels Limited - India
- Medco Energi Mining Internasional
- Miang Besar Coal Terminal - Indonesia
- Kideco Jaya Agung - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Makarim & Taira - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- South Luzon Thermal Energy Corporation
- GVK Power & Infra Limited - India
- Romanian Commodities Exchange
- VISA Power Limited - India
- Independent Power Producers Association of India
- IEA Clean Coal Centre - UK
- Karbindo Abesyapradhi - Indoneisa
- Chettinad Cement Corporation Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Iligan Light & Power Inc, Philippines
- Chamber of Mines of South Africa
- Meenaskhi Energy Private Limited - India
- Mjunction Services Limited - India
- Ministry of Finance - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Coastal Gujarat Power Limited - India
- Bharathi Cement Corporation - India
- AsiaOL BioFuels Corp., Philippines
- Indonesian Coal Mining Association
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Central Electricity Authority - India
- Siam City Cement PLC, Thailand
- Parliament of New Zealand
- Attock Cement Pakistan Limited
- Neyveli Lignite Corporation Ltd, - India
- Sakthi Sugars Limited - India
- IHS Mccloskey Coal Group - USA
- Eastern Energy - Thailand
- Vizag Seaport Private Limited - India
- Wood Mackenzie - Singapore
- Parry Sugars Refinery, India
- Tata Chemicals Ltd - India
- Thiess Contractors Indonesia
- Mercator Lines Limited - India
- Sree Jayajothi Cements Limited - India
- Cement Manufacturers Association - India
- Dalmia Cement Bharat India
- Tamil Nadu electricity Board
- Maharashtra Electricity Regulatory Commission - India
- Orica Australia Pty. Ltd.
- Altura Mining Limited, Indonesia
- Bhatia International Limited - India
- GAC Shipping (India) Pvt Ltd
- Grasim Industreis Ltd - India
- Meralco Power Generation, Philippines
- Kepco SPC Power Corporation, Philippines
- Vedanta Resources Plc - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- London Commodity Brokers - England
- Eastern Coal Council - USA
- Kapuas Tunggal Persada - Indonesia
- Sical Logistics Limited - India
- Anglo American - United Kingdom
- Planning Commission, India
- Minerals Council of Australia
- Wilmar Investment Holdings
- Ministry of Mines - Canada
- The State Trading Corporation of India Ltd
- Trasteel International SA, Italy
- Australian Commodity Traders Exchange
- PowerSource Philippines DevCo
- GMR Energy Limited - India
- Ind-Barath Power Infra Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Globalindo Alam Lestari - Indonesia
- Kumho Petrochemical, South Korea
- TNB Fuel Sdn Bhd - Malaysia
- Global Coal Blending Company Limited - Australia
- Energy Link Ltd, New Zealand
- Banpu Public Company Limited - Thailand
- International Coal Ventures Pvt Ltd - India
- McConnell Dowell - Australia
- Jorong Barutama Greston.PT - Indonesia
- Posco Energy - South Korea
- PTC India Limited - India
- Bangladesh Power Developement Board
- Simpson Spence & Young - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Straits Asia Resources Limited - Singapore
- Therma Luzon, Inc, Philippines
- Bhoruka Overseas - Indonesia
- Ambuja Cements Ltd - India
- Indian Oil Corporation Limited
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- Heidelberg Cement - Germany
- SN Aboitiz Power Inc, Philippines
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- Interocean Group of Companies - India
- Intertek Mineral Services - Indonesia
- Price Waterhouse Coopers - Russia
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