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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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Friday, 02 August 24
COAL MARKET DEVELOPMENTS: FALLING PRICES AMID RECORD-HIGH OUTPUT - WORLD BANK
Coal prices inched up in May (m/m) following an 8 percent decline in 2024Q1. The Australian and South African benchmarks have plummeted more ...
Friday, 26 July 24
FUELEU MARITME IS COMING. IS YOUR CHARTERPARTY READY? - GARD
With less than six months to implementation of FuelEU Maritime in EU and EEA trades, there has been little published advice regarding how to alloca ...
Thursday, 04 July 24
INDIA'S COAL PRODUCTION RISES 14% IN JUNE - PTI
The country’s coal production rose by 14.49% to 84.63 million tonne (MT) in June. The country’s coal output was 73.92 MT in June last f ...
Tuesday, 02 July 24
NTPC CAPTIVE COAL OUTPUT GROWS 15% IN Q1; DESPATCH RISES 17%
State-owned NTPC on Monday reported a 15 per cent year-on-year increase in the production of coal from captives mines to 9.862 metric million tonne ...
Friday, 28 June 24
KOSPO INVITED BIDS FOR 400,000 MT OF MINIMUM 4000 NCV COAL FOR FIVE YEARS
Korea Southern Power Co., Ltd. (KOSPO), is inviting bids for total 400,000 MT of Low Calorific Value Coal for 5 years starting from July 2024 until ...
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- ICICI Bank Limited - India
- International Coal Ventures Pvt Ltd - India
- Renaissance Capital - South Africa
- Interocean Group of Companies - India
- White Energy Company Limited
- Antam Resourcindo - Indonesia
- CIMB Investment Bank - Malaysia
- Rashtriya Ispat Nigam Limited - India
- GVK Power & Infra Limited - India
- Toyota Tsusho Corporation, Japan
- McConnell Dowell - Australia
- Mintek Dendrill Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Metalloyd Limited - United Kingdom
- Pendopo Energi Batubara - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Global Coal Blending Company Limited - Australia
- Energy Link Ltd, New Zealand
- Tamil Nadu electricity Board
- SN Aboitiz Power Inc, Philippines
- GMR Energy Limited - India
- Straits Asia Resources Limited - Singapore
- Mercuria Energy - Indonesia
- Bangladesh Power Developement Board
- Indogreen Group - Indonesia
- Chamber of Mines of South Africa
- TNB Fuel Sdn Bhd - Malaysia
- Ministry of Mines - Canada
- Global Business Power Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Thai Mozambique Logistica
- Star Paper Mills Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Energy Development Corp, Philippines
- Barasentosa Lestari - Indonesia
- Samtan Co., Ltd - South Korea
- Parry Sugars Refinery, India
- Trasteel International SA, Italy
- Meenaskhi Energy Private Limited - India
- Salva Resources Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Sree Jayajothi Cements Limited - India
- Bhatia International Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Posco Energy - South Korea
- Ministry of Finance - Indonesia
- Eastern Coal Council - USA
- Xindia Steels Limited - India
- Larsen & Toubro Limited - India
- Directorate Of Revenue Intelligence - India
- Krishnapatnam Port Company Ltd. - India
- VISA Power Limited - India
- Siam City Cement PLC, Thailand
- Simpson Spence & Young - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Indika Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Meralco Power Generation, Philippines
- Vedanta Resources Plc - India
- Indian Energy Exchange, India
- SMG Consultants - Indonesia
- Jindal Steel & Power Ltd - India
- Chettinad Cement Corporation Ltd - India
- South Luzon Thermal Energy Corporation
- Aboitiz Power Corporation - Philippines
- Madhucon Powers Ltd - India
- Timah Investasi Mineral - Indoneisa
- San Jose City I Power Corp, Philippines
- Formosa Plastics Group - Taiwan
- TeaM Sual Corporation - Philippines
- Uttam Galva Steels Limited - India
- Siam City Cement - Thailand
- PTC India Limited - India
- Indo Tambangraya Megah - Indonesia
- SMC Global Power, Philippines
- PNOC Exploration Corporation - Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kaltim Prima Coal - Indonesia
- Marubeni Corporation - India
- Coastal Gujarat Power Limited - India
- Wilmar Investment Holdings
- Kobexindo Tractors - Indoneisa
- Videocon Industries ltd - India
- Maheswari Brothers Coal Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Mjunction Services Limited - India
- Essar Steel Hazira Ltd - India
- MS Steel International - UAE
- Medco Energi Mining Internasional
- Australian Coal Association
- Sindya Power Generating Company Private Ltd
- Gujarat Mineral Development Corp Ltd - India
- Bukit Makmur.PT - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Eastern Energy - Thailand
- Dalmia Cement Bharat India
- Binh Thuan Hamico - Vietnam
- Directorate General of MIneral and Coal - Indonesia
- Grasim Industreis Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Manunggal Multi Energi - Indonesia
- Aditya Birla Group - India
- Bulk Trading Sa - Switzerland
- Semirara Mining Corp, Philippines
- Coal and Oil Company - UAE
- Bahari Cakrawala Sebuku - Indonesia
- Agrawal Coal Company - India
- Ceylon Electricity Board - Sri Lanka
- Merrill Lynch Commodities Europe
- Singapore Mercantile Exchange
- European Bulk Services B.V. - Netherlands
- Ministry of Transport, Egypt
- Parliament of New Zealand
- Minerals Council of Australia
- Banpu Public Company Limited - Thailand
- Port Waratah Coal Services - Australia
- Kumho Petrochemical, South Korea
- LBH Netherlands Bv - Netherlands
- Baramulti Group, Indonesia
- Kapuas Tunggal Persada - Indonesia
- Indonesian Coal Mining Association
- Indian Oil Corporation Limited
- ASAPP Information Group - India
- PetroVietnam Power Coal Import and Supply Company
- Electricity Authority, New Zealand
- London Commodity Brokers - England
- Africa Commodities Group - South Africa
- Kideco Jaya Agung - Indonesia
- Price Waterhouse Coopers - Russia
- Billiton Holdings Pty Ltd - Australia
- Planning Commission, India
- Makarim & Taira - Indonesia
- Anglo American - United Kingdom
- Oldendorff Carriers - Singapore
- Wood Mackenzie - Singapore
- Globalindo Alam Lestari - Indonesia
- Ind-Barath Power Infra Limited - India
- Goldman Sachs - Singapore
- Petron Corporation, Philippines
- Central Java Power - Indonesia
- Edison Trading Spa - Italy
- Gujarat Electricity Regulatory Commission - India
- Carbofer General Trading SA - India
- Sical Logistics Limited - India
- Iligan Light & Power Inc, Philippines
- Sakthi Sugars Limited - India
- Alfred C Toepfer International GmbH - Germany
- Australian Commodity Traders Exchange
- Mercator Lines Limited - India
- Karaikal Port Pvt Ltd - India
- Power Finance Corporation Ltd., India
- GN Power Mariveles Coal Plant, Philippines
- GAC Shipping (India) Pvt Ltd
- Maharashtra Electricity Regulatory Commission - India
- Heidelberg Cement - Germany
- Bharathi Cement Corporation - India
- Semirara Mining and Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Economic Council, Georgia
- Global Green Power PLC Corporation, Philippines
- Electricity Generating Authority of Thailand
- Kartika Selabumi Mining - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Orica Australia Pty. Ltd.
- The University of Queensland
- Sojitz Corporation - Japan
- CNBM International Corporation - China
- Karbindo Abesyapradhi - Indoneisa
- Romanian Commodities Exchange
- Bhushan Steel Limited - India
- India Bulls Power Limited - India
- Independent Power Producers Association of India
- Petrochimia International Co. Ltd.- Taiwan
- Ambuja Cements Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Therma Luzon, Inc, Philippines
- Commonwealth Bank - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Malabar Cements Ltd - India
- Latin American Coal - Colombia
- IHS Mccloskey Coal Group - USA
- Savvy Resources Ltd - HongKong
- Thiess Contractors Indonesia
- Georgia Ports Authority, United States
- Orica Mining Services - Indonesia
- Deloitte Consulting - India
- Kepco SPC Power Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Altura Mining Limited, Indonesia
- Rio Tinto Coal - Australia
- Lanco Infratech Ltd - India
- IEA Clean Coal Centre - UK
- Standard Chartered Bank - UAE
- Coalindo Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Neyveli Lignite Corporation Ltd, - India
- PowerSource Philippines DevCo
- Jaiprakash Power Ventures ltd
- New Zealand Coal & Carbon
- Central Electricity Authority - India
- OPG Power Generation Pvt Ltd - India
- Tata Chemicals Ltd - India
- Intertek Mineral Services - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Cement Manufacturers Association - India
- Bukit Baiduri Energy - Indonesia
- Attock Cement Pakistan Limited
- Sarangani Energy Corporation, Philippines
- Borneo Indobara - Indonesia
- The Treasury - Australian Government
- The State Trading Corporation of India Ltd
- Riau Bara Harum - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Vizag Seaport Private Limited - India
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