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Wednesday, 12 October 16
UK SEABORNE COAL IMPORT PLUNGES 64% AS A WORRYING TREND LURKS - BIMCO
 The main exporters of thermal coal for coal- fired power plants to the United Kingdom (UK) have experienced a heavy decline in seaborne cargo volumes in 2016. This comes as a result of the UK starting a concerning trend for the dry bulk shipping industry, by close to doubling its Carbon Price Floor (CPF).
Russia, Colombia and the United States (US) have been the top coal exporters to the UK for the previous three years. The long hauls from the US and Colombia have historically been strong routes for the dry bulk industry, as they have provided a lot of tonnage miles. Since the UK increased their CPF to £18 per tonne of CO2, the exports from the three main exporters during the first 7 months have declined 69% compared to last year and the UK total import of coal for coal- fired power plants is down 64% for the same period.
Peter Sand Chief Shipping Analyst at BIMCO comments: “This is one of the most significant effects, which has impacted the demand side of the global dry bulk shipping industry in 2016. It reflects something bigger lurking beneath the surface of the coal industry and in transportation of this commodity.
The declining trend in coal consumption in the UK is affecting the dry bulk industry negatively and this story will not be the only one”.
UK carbon price floor increases coal price by 138%
When the CPF first came into effect in April 2013, it was based on the carbon price support (CPS) price per tonne of CO2 on top of the EU emission trading system (ETS) rate per tonne of CO2. At that time the CPS was £0.819 per Gigajoule (GJ). The introduction of this led to closures of several coal plants from 2012-2014 in the UK, with a total capacity of 8.4 Gigawatt (GW), enough to generate electricity for an estimated 6.7 million homes (Total: 25 million homes).
From the beginning of 2016 the CPS was increased to £1.568 per GJ equalling to around £18 per tonne of CO2, operating on top of the EU ETS at €5 per tonne of CO2. In September 2016 this was equivalent to a tax around £63.90 on a tonne coal worth £46.38 (CIF ARA). This increase led to a further closure of 8.2 GW in 2015 and 2016.
The CPF will double again in 2020 to £30 per tonne of CO2 and by 2030 it will be £70 per tonne of CO2.
Peter Sand adds:” Implementing a tax which increased the total price of coal by 138 %, caused an immediate reaction from the UK coal-fired power plants. The dry bulk industry is hugely affected by this, due to a large reduction in long haul thermal coal imports.”
The capacity taken out as a result of closures has put the UK into a position where their domestically produced supply of electricity will struggle to meet peaks in demand. In the case of domestically produced electricity falling short of demand, the UK will need to rely on importing electricity from other European countries.
Depending on the other European countries energy mix, their electricity exports will be a surplus of renewable fossil fuel – or nuclear energy. If the electricity generated comes from fossil fuel it may offset the declining UK coal imports somewhat and the change in demand for the dry bulk shipping industry will be less severe.
Price floor does the trading scheme’s job
While the effect of the UK carbon price floor to coal imports is undeniable, the European Union emission trading scheme (ETS) has not limited coal imports to the same extent. The development of the European ETS rate per tonne of CO2 from €30 in 2008 to the current €5, has not incentivised others to reduce coal consumption on a large scale. The decrease of the EU ETS rate is primarily due to an oversupply in allowances.
K coal consumption has been falling for four years, while the development in EU coal consumption has been more stable. The increase of the CPF level in 2016, caused a decline of 56.7% year-on-year for the first five months of 2016. A total of 6,839 thousand tonnes was consumed in the first five months, compared to 15,800 thousand tonnes in the year before.
Peter Sand comments: “It will be a setback for the dry bulk shipping industry if the CPF becomes a standardised scheme and is adopted by other nations as well as on a supranational level. It will, if introduced at the same level as in the UK, cause a similar development and closure of coal-fired power plants.
France, importing the fourth largest share of coal for European countries (8%) in 2016, has already imposed a CPF on 30€ per tonne of CO2 planned to be introduced in January 2017”.
Source: BIMCO
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Wednesday, 31 January 24
CHINA'S INNER MONGOLIA COAL OUTPUT HIT 1.21B TONS IN 2023 - XINHUA
North China’s Inner Mongolia autonomous region churned out 1.21 billion tons of coal in 2023 as it strives to guarantee the country’s e ...
Wednesday, 31 January 24
GAS EXPORTS COST U.S. CONSUMERS MORE THAN $100 BILLION OVER 16-MONTH PERIOD - IEEFA
Limited Demand Growth Could Dampen the Dry Bulk Market in the Coming Months BIMCOStarting in late 2021—before its invasion of Ukraine—R ...
Tuesday, 30 January 24
LIMITED DEMAND GROWTH COULD DAMPEN THE DRY BULK MARKET IN THE COMING MONTHS - BIMCO
Demand
In our base scenario, we expect cargo demand to grow by 0-1% in 2024 and 0.5-1.5% in 2025. This is a 0.5 percentage point reduction for ...
Friday, 26 January 24
RED SEA DIVERSIONS ADD NEARLY A MILLION DOLLARS PER VOYAGE TO SHIPPING COSTS WHILE DOUBLING TRANSIT TIME - LSEG
The incremental costs of diverting a tanker from Asia to NW Europe via the Cape of Good Hope is accounting for an extra $932,905 USD per voyage whi ...
Friday, 26 January 24
HARD COAL GUARDIAN ANGEL OF THE ENERGY SUPPLY - GERMANY COAL IMPORTERS ASSOCIATION
- No security of supply without hard coal
- The Substitute Power Plant Provision Act (EKBG) must be extended
- Higher grid fees due to the ...
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- Renaissance Capital - South Africa
- MS Steel International - UAE
- Star Paper Mills Limited - India
- Iligan Light & Power Inc, Philippines
- Aditya Birla Group - India
- Tata Chemicals Ltd - India
- Straits Asia Resources Limited - Singapore
- Kaltim Prima Coal - Indonesia
- Orica Australia Pty. Ltd.
- Banpu Public Company Limited - Thailand
- Trasteel International SA, Italy
- Meenaskhi Energy Private Limited - India
- IHS Mccloskey Coal Group - USA
- Orica Mining Services - Indonesia
- Karaikal Port Pvt Ltd - India
- Parliament of New Zealand
- Ceylon Electricity Board - Sri Lanka
- Kepco SPC Power Corporation, Philippines
- Electricity Generating Authority of Thailand
- Australian Commodity Traders Exchange
- Timah Investasi Mineral - Indoneisa
- Dalmia Cement Bharat India
- Bukit Baiduri Energy - Indonesia
- VISA Power Limited - India
- Sarangani Energy Corporation, Philippines
- Eastern Coal Council - USA
- McConnell Dowell - Australia
- Rio Tinto Coal - Australia
- Vijayanagar Sugar Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Bhushan Steel Limited - India
- IEA Clean Coal Centre - UK
- The State Trading Corporation of India Ltd
- Krishnapatnam Port Company Ltd. - India
- Mercator Lines Limited - India
- Uttam Galva Steels Limited - India
- Bharathi Cement Corporation - India
- Barasentosa Lestari - Indonesia
- Planning Commission, India
- PTC India Limited - India
- Siam City Cement - Thailand
- Ministry of Mines - Canada
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Finance - Indonesia
- Aboitiz Power Corporation - Philippines
- Bhoruka Overseas - Indonesia
- London Commodity Brokers - England
- Sakthi Sugars Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Kideco Jaya Agung - Indonesia
- Economic Council, Georgia
- San Jose City I Power Corp, Philippines
- India Bulls Power Limited - India
- Semirara Mining Corp, Philippines
- SN Aboitiz Power Inc, Philippines
- Heidelberg Cement - Germany
- Gujarat Electricity Regulatory Commission - India
- Xindia Steels Limited - India
- Romanian Commodities Exchange
- Formosa Plastics Group - Taiwan
- Makarim & Taira - Indonesia
- Lanco Infratech Ltd - India
- Thai Mozambique Logistica
- Posco Energy - South Korea
- Deloitte Consulting - India
- Altura Mining Limited, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Medco Energi Mining Internasional
- Indo Tambangraya Megah - Indonesia
- Bhatia International Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Marubeni Corporation - India
- Larsen & Toubro Limited - India
- Central Electricity Authority - India
- Leighton Contractors Pty Ltd - Australia
- Therma Luzon, Inc, Philippines
- New Zealand Coal & Carbon
- Coastal Gujarat Power Limited - India
- SMG Consultants - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Riau Bara Harum - Indonesia
- Baramulti Group, Indonesia
- Binh Thuan Hamico - Vietnam
- Billiton Holdings Pty Ltd - Australia
- Bulk Trading Sa - Switzerland
- International Coal Ventures Pvt Ltd - India
- Indogreen Group - Indonesia
- Antam Resourcindo - Indonesia
- Jaiprakash Power Ventures ltd
- PowerSource Philippines DevCo
- Kohat Cement Company Ltd. - Pakistan
- Metalloyd Limited - United Kingdom
- Australian Coal Association
- Salva Resources Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Sical Logistics Limited - India
- Indian Energy Exchange, India
- Kobexindo Tractors - Indoneisa
- CIMB Investment Bank - Malaysia
- The Treasury - Australian Government
- Parry Sugars Refinery, India
- Directorate Of Revenue Intelligence - India
- Tamil Nadu electricity Board
- Thiess Contractors Indonesia
- Chamber of Mines of South Africa
- GAC Shipping (India) Pvt Ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mjunction Services Limited - India
- Toyota Tsusho Corporation, Japan
- Malabar Cements Ltd - India
- Coal and Oil Company - UAE
- Wood Mackenzie - Singapore
- Energy Link Ltd, New Zealand
- Ministry of Transport, Egypt
- Indika Energy - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Attock Cement Pakistan Limited
- Alfred C Toepfer International GmbH - Germany
- Miang Besar Coal Terminal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Grasim Industreis Ltd - India
- Africa Commodities Group - South Africa
- Bank of Tokyo Mitsubishi UFJ Ltd
- SMC Global Power, Philippines
- Holcim Trading Pte Ltd - Singapore
- GN Power Mariveles Coal Plant, Philippines
- The University of Queensland
- Directorate General of MIneral and Coal - Indonesia
- Vizag Seaport Private Limited - India
- White Energy Company Limited
- Borneo Indobara - Indonesia
- Sree Jayajothi Cements Limited - India
- Coalindo Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Independent Power Producers Association of India
- Eastern Energy - Thailand
- OPG Power Generation Pvt Ltd - India
- Sindya Power Generating Company Private Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Singapore Mercantile Exchange
- Anglo American - United Kingdom
- Standard Chartered Bank - UAE
- Kartika Selabumi Mining - Indonesia
- Samtan Co., Ltd - South Korea
- Port Waratah Coal Services - Australia
- Gujarat Sidhee Cement - India
- Gujarat Mineral Development Corp Ltd - India
- Intertek Mineral Services - Indonesia
- Ind-Barath Power Infra Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Petron Corporation, Philippines
- Kumho Petrochemical, South Korea
- Central Java Power - Indonesia
- Jindal Steel & Power Ltd - India
- Georgia Ports Authority, United States
- Indian Oil Corporation Limited
- Maheswari Brothers Coal Limited - India
- GVK Power & Infra Limited - India
- Goldman Sachs - Singapore
- Global Green Power PLC Corporation, Philippines
- Oldendorff Carriers - Singapore
- Global Business Power Corporation, Philippines
- Siam City Cement PLC, Thailand
- AsiaOL BioFuels Corp., Philippines
- Latin American Coal - Colombia
- Simpson Spence & Young - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- European Bulk Services B.V. - Netherlands
- Essar Steel Hazira Ltd - India
- Sojitz Corporation - Japan
- Savvy Resources Ltd - HongKong
- TeaM Sual Corporation - Philippines
- South Luzon Thermal Energy Corporation
- Cigading International Bulk Terminal - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Minerals Council of Australia
- Pendopo Energi Batubara - Indonesia
- Cement Manufacturers Association - India
- Chettinad Cement Corporation Ltd - India
- Merrill Lynch Commodities Europe
- PNOC Exploration Corporation - Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bangladesh Power Developement Board
- Indonesian Coal Mining Association
- ASAPP Information Group - India
- Mercuria Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Power Finance Corporation Ltd., India
- Manunggal Multi Energi - Indonesia
- Madhucon Powers Ltd - India
- Carbofer General Trading SA - India
- Interocean Group of Companies - India
- LBH Netherlands Bv - Netherlands
- Vedanta Resources Plc - India
- GMR Energy Limited - India
- Electricity Authority, New Zealand
- Bukit Makmur.PT - Indonesia
- Commonwealth Bank - Australia
- Edison Trading Spa - Italy
- Agrawal Coal Company - India
- Wilmar Investment Holdings
- ICICI Bank Limited - India
- Ambuja Cements Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- CNBM International Corporation - China
- Videocon Industries ltd - India
- Bayan Resources Tbk. - Indonesia
- Globalindo Alam Lestari - Indonesia
- Meralco Power Generation, Philippines
- Mintek Dendrill Indonesia
- Global Coal Blending Company Limited - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Energy Development Corp, Philippines
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