We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Tuesday, 30 December 14
INDIA INC TO BENEFIT AS IMPORTED COAL PRICES SET TO FALL - RAHUL PRITHIANI
The Hindu: India‘s coal import volumes are set to rise by over 30 per cent over the next two years to 214 million tonnes in 2015-16, as domestic supply falls short of surging demand.
However, globally, the situation is just the reverse. Severe oversupply with few takers will drag down prices of both thermal and coking coal by about 25 per cent. This will slash fuel costs and support the profitability of India Inc. Lower prices will also cap India’s coal import bill, unlike a 17 per cent annual growth witnessed over the last five years.
Supply soars
Miners in major coal exporting countries like Indonesia and Australia have significantly ramped up investments over the past five years, anticipating steady off take from major importers such as India and China. For example, coal mining investments in Australia are estimated to have doubled to about $50 billion over 2009 to 2013 from about $25 billion over 2003 to 2008. Moreover, domestic coal supply in China is also likely to increase as its railway capacity for hauling coal expands by nearly one-third to three billion tonne by 2020. This will ease transportation bottlenecks in that country.
Thus, while coal supplies will grow, there are likely to be few takers.
Even as miners stack up supplies, off take by major consumers including China, the U.S. and Europe is set to post a muted rise. Weak GDP growth, a gradual shift to cleaner fuels and rising energy efficiencies will curb demand.
The most telling fact is that China, the world’s largest importer of coal, has placed import curbs, will further restrict demand. Over the last three months, it has banned imports of low-grade coal, while imposing import duties on both thermal (six per cent) and coking coal (three per cent). Global economic weakness and China’s measures to move away from an investment-led growth model will also halve the growth in coking coal importsover the next five years.
Thus, oversupply in the global coal market, along with weakening currencies in exporting countries, is expected to drag down thermal and coking coal prices by 25 per cent approximately over the next two years to $65 per tonne and $115 per tonne by 2015, respectively.
Advantage India
For India, which has scarce domestic energy resources, the above changing dynamics certainly bode well. India’s coal import volumes are expected to rise by 33 per cent over the next two years, as domestic production lags demand. In such a scenario, falling global coal prices will help India Inc.
In the power sector, projects running on imported coal — including that of Tata Power, Adani Power and Essar Power — will benefit the most from sliding coal prices. These projects have incurred huge losses since 2012-13 when Indonesian coal prices almost doubled following a change in regulations. However, with imported coal prices plummeting, returns of such projects are expected to improve. As per our analysis, for a project operating on imported coal, even a one per cent fall in fuel costs will drive up equity returns by 25 basis points.
Even power projects based on domestic coal will benefit, as they can increase blending of imported coal and boost utilisation rates. In particular, plant-load factors (PLFs) of post-2009 power projects, which languished at just 51 per cent in 2013-14, will improve gradually.
Similarly, input costs for cement and metal manufacturers will decline, supporting their profitability. For cement players, reliance on imported coal has gradually risen — reaching 30-35 per cent of total coal consumption in 2013-14, as the power sector was prioritised for domestic coal supply. As demand growth slowed and operating costs rose, the industry’s operating margins fell to 15 per cent in 2013-14 from 28 per cent in 2009-10. Therefore, falling imported coal prices, will reduce cost pressures for the sector through lower fuel costs, which will decline by 3-4 per cent in 2014-15. In particular, cement plants, which have higher reliance on coal imports, will witness a much sharper reduction in fuel costs, as imported coal prices are set to fall by 15-17 per cent in 2014-15.
The decline in global coking coal prices is good news even for steelmakers beset by muted demand and global overcapacity. With good-quality domestic supply being scarce, Indian steelmakers import nearly 70 per cent of their coking coal requirements and coal accounts for 30 per cent of their manufacturing costs. Thus, a sharp decline in global coking coal prices will drag down operating costs by 6-8 per cent in 2014-15 and thereby support profitability.
There are also some macroeconomic advantages. Most importantly, despite the rise in coal import (volumes), the value (or the import bill) will only rise marginally at a CAGR of one per cent over the next two years. This contrasts sharply vis-à-vis the past 5 years, when the bill had risen at a 17 per cent CAGR to Rs.888 billion (approximately US$ 13,950,428,156).
The author is Director, CRISIL.
Source: The Hindu
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Friday, 05 December 14
CHINESE SPECIAL STEEL MAKERS' RISK PROFILES MORE RESILIENT - FITCH
Fitch Ratings says the risk profiles of Chinese makers of special steel, especially high-end products, are more like those of manufacturers and mor ...
Friday, 05 December 14
U.S. YEAR-TO-DATE COAL PRODUCTION REACHED AROUND 905 MMST - EIA
COALspot.com – United States the world's one of the largest coal producers, produced approximately 19 million short tons (mmst) of coal i ...
Thursday, 04 December 14
CAPE MARKET IS DEVELOPING FROM BAD TO WORSE
Handy
The Atlantic market has been pretty stable and balanced this week, Fearnleys AS says in its latest weekly report.
The broker furt ...
Thursday, 04 December 14
DRY BULK MARKET; ANOTHER DISAPPOINTING WEEK
COALspot.com: For those who have been hoping to see alignment of freight direction across the Dry Bulk market, this must have been another disappoi ...
Wednesday, 03 December 14
PROGRESSING SMELTER PROJECTS IN INDONESIA
Press Release: Indonesia’s ban on ‘raw mineral export’ that was designed to encouraging downstream investment in mineral processi ...
|
|
|
Showing 3326 to 3330 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- GN Power Mariveles Coal Plant, Philippines
- Siam City Cement - Thailand
- Romanian Commodities Exchange
- Parry Sugars Refinery, India
- Chettinad Cement Corporation Ltd - India
- Goldman Sachs - Singapore
- ASAPP Information Group - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Posco Energy - South Korea
- Formosa Plastics Group - Taiwan
- Metalloyd Limited - United Kingdom
- Ind-Barath Power Infra Limited - India
- Salva Resources Pvt Ltd - India
- Electricity Authority, New Zealand
- Aboitiz Power Corporation - Philippines
- Kideco Jaya Agung - Indonesia
- Edison Trading Spa - Italy
- Merrill Lynch Commodities Europe
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Ministry of Finance - Indonesia
- Wood Mackenzie - Singapore
- White Energy Company Limited
- Eastern Coal Council - USA
- Grasim Industreis Ltd - India
- Borneo Indobara - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- The State Trading Corporation of India Ltd
- Straits Asia Resources Limited - Singapore
- Madhucon Powers Ltd - India
- Carbofer General Trading SA - India
- Intertek Mineral Services - Indonesia
- Therma Luzon, Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- India Bulls Power Limited - India
- AsiaOL BioFuels Corp., Philippines
- Ministry of Mines - Canada
- Orica Australia Pty. Ltd.
- GMR Energy Limited - India
- Minerals Council of Australia
- South Luzon Thermal Energy Corporation
- Port Waratah Coal Services - Australia
- Banpu Public Company Limited - Thailand
- Sojitz Corporation - Japan
- Gujarat Electricity Regulatory Commission - India
- Uttam Galva Steels Limited - India
- Agrawal Coal Company - India
- Globalindo Alam Lestari - Indonesia
- Indogreen Group - Indonesia
- Singapore Mercantile Exchange
- Star Paper Mills Limited - India
- SMG Consultants - Indonesia
- Sakthi Sugars Limited - India
- Economic Council, Georgia
- Petrochimia International Co. Ltd.- Taiwan
- Mjunction Services Limited - India
- Vizag Seaport Private Limited - India
- Coastal Gujarat Power Limited - India
- Global Coal Blending Company Limited - Australia
- Pendopo Energi Batubara - Indonesia
- Attock Cement Pakistan Limited
- Mercator Lines Limited - India
- Independent Power Producers Association of India
- Gujarat Sidhee Cement - India
- Aditya Birla Group - India
- Thai Mozambique Logistica
- Iligan Light & Power Inc, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Kepco SPC Power Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Georgia Ports Authority, United States
- Indonesian Coal Mining Association
- Central Java Power - Indonesia
- The Treasury - Australian Government
- Timah Investasi Mineral - Indoneisa
- Thiess Contractors Indonesia
- LBH Netherlands Bv - Netherlands
- Kalimantan Lumbung Energi - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Karaikal Port Pvt Ltd - India
- Coalindo Energy - Indonesia
- Standard Chartered Bank - UAE
- Directorate General of MIneral and Coal - Indonesia
- The University of Queensland
- CIMB Investment Bank - Malaysia
- Maheswari Brothers Coal Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Rio Tinto Coal - Australia
- Chamber of Mines of South Africa
- Binh Thuan Hamico - Vietnam
- London Commodity Brokers - England
- Bangladesh Power Developement Board
- SMC Global Power, Philippines
- ICICI Bank Limited - India
- Miang Besar Coal Terminal - Indonesia
- Barasentosa Lestari - Indonesia
- Energy Link Ltd, New Zealand
- OPG Power Generation Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Xindia Steels Limited - India
- Semirara Mining and Power Corporation, Philippines
- Eastern Energy - Thailand
- Anglo American - United Kingdom
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Baramulti Group, Indonesia
- GAC Shipping (India) Pvt Ltd
- PNOC Exploration Corporation - Philippines
- Kapuas Tunggal Persada - Indonesia
- Essar Steel Hazira Ltd - India
- Meralco Power Generation, Philippines
- Bhoruka Overseas - Indonesia
- Kobexindo Tractors - Indoneisa
- Gujarat Mineral Development Corp Ltd - India
- Ministry of Transport, Egypt
- Power Finance Corporation Ltd., India
- Jorong Barutama Greston.PT - Indonesia
- Indika Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bayan Resources Tbk. - Indonesia
- SN Aboitiz Power Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
- PTC India Limited - India
- Directorate Of Revenue Intelligence - India
- Bahari Cakrawala Sebuku - Indonesia
- Bhushan Steel Limited - India
- Orica Mining Services - Indonesia
- Global Green Power PLC Corporation, Philippines
- IEA Clean Coal Centre - UK
- Maharashtra Electricity Regulatory Commission - India
- Interocean Group of Companies - India
- Bharathi Cement Corporation - India
- Sindya Power Generating Company Private Ltd
- Meenaskhi Energy Private Limited - India
- CNBM International Corporation - China
- Planning Commission, India
- Petron Corporation, Philippines
- Makarim & Taira - Indonesia
- Price Waterhouse Coopers - Russia
- Indo Tambangraya Megah - Indonesia
- Bhatia International Limited - India
- Holcim Trading Pte Ltd - Singapore
- Antam Resourcindo - Indonesia
- International Coal Ventures Pvt Ltd - India
- Dalmia Cement Bharat India
- GVK Power & Infra Limited - India
- Larsen & Toubro Limited - India
- Lanco Infratech Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- IHS Mccloskey Coal Group - USA
- Oldendorff Carriers - Singapore
- Leighton Contractors Pty Ltd - Australia
- Simpson Spence & Young - Indonesia
- Jindal Steel & Power Ltd - India
- Mintek Dendrill Indonesia
- Semirara Mining Corp, Philippines
- San Jose City I Power Corp, Philippines
- European Bulk Services B.V. - Netherlands
- Bukit Makmur.PT - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Bulk Trading Sa - Switzerland
- Kaltim Prima Coal - Indonesia
- Electricity Generating Authority of Thailand
- Parliament of New Zealand
- Samtan Co., Ltd - South Korea
- Kohat Cement Company Ltd. - Pakistan
- Sical Logistics Limited - India
- Sree Jayajothi Cements Limited - India
- Energy Development Corp, Philippines
- Kumho Petrochemical, South Korea
- Heidelberg Cement - Germany
- Ambuja Cements Ltd - India
- TeaM Sual Corporation - Philippines
- PowerSource Philippines DevCo
- Sinarmas Energy and Mining - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Latin American Coal - Colombia
- Vijayanagar Sugar Pvt Ltd - India
- Commonwealth Bank - Australia
- Deloitte Consulting - India
- Central Electricity Authority - India
- Coal and Oil Company - UAE
- VISA Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- Indian Energy Exchange, India
- Cement Manufacturers Association - India
- Tamil Nadu electricity Board
- Africa Commodities Group - South Africa
- Medco Energi Mining Internasional
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Riau Bara Harum - Indonesia
- Altura Mining Limited, Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Global Business Power Corporation, Philippines
- Australian Commodity Traders Exchange
- Videocon Industries ltd - India
- Sarangani Energy Corporation, Philippines
- Renaissance Capital - South Africa
- Vedanta Resources Plc - India
- Pipit Mutiara Jaya. PT, Indonesia
- Billiton Holdings Pty Ltd - Australia
- Kartika Selabumi Mining - Indonesia
- Australian Coal Association
- Siam City Cement PLC, Thailand
- MS Steel International - UAE
- Indian Oil Corporation Limited
- Marubeni Corporation - India
- Trasteel International SA, Italy
- Tata Chemicals Ltd - India
- Krishnapatnam Port Company Ltd. - India
- McConnell Dowell - Australia
- Savvy Resources Ltd - HongKong
- Malabar Cements Ltd - India
- Manunggal Multi Energi - Indonesia
- Wilmar Investment Holdings
- Jaiprakash Power Ventures ltd
- Mercuria Energy - Indonesia
- New Zealand Coal & Carbon
|
| |
| |
|
