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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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Monday, 26 December 16
DO THE DERIVATIVES MARKETS MAKE COAL PRICES MORE VOLATILE? 59.21% SAY YES, POLL
COALspot.com: The substantial increase or decrease in coal prices within a short period of time has been supported by a number of fundamental drive ...
Friday, 23 December 16
U.S. YEAR-TO-DATE COAL PRODUCTION TOTALED 711.1 MMST; DOWN 18.5% Y/Y - EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 15.7 million short ton ...
Thursday, 22 December 16
INDONESIA LACK OF EXPORT TO INDIA THIS WEEK - FERNLEYS
Supramax
While the Atlantic is keeping up with rates, the Pacific has been weaker says Astrup Fernley.
According to Astrup Fernley, backhaul ...
Wednesday, 21 December 16
THE SUPREME COURT DECISION IN OW BUNKERS - WHEN A SALE OF GOODS IS NOT A SALE OF GOODS - LEON ALEXANDER, CLYDE&CO
KNOWLEDGE TO ELEVATE
In May 2016 the Supreme Court of England & Wales gave judgment in an OW Bunkers test case entitled "Res Cogitans ...
Wednesday, 21 December 16
CLEANING THE OCEANS FROM PLASTIC - SOPHIE COTZIAS
2016 is coming to a close and it finds us in preparation for the 2017 enforcement of the Ballast Water Treatment Systems. We naturally are in thoug ...
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- Billiton Holdings Pty Ltd - Australia
- India Bulls Power Limited - India
- Xindia Steels Limited - India
- Bhushan Steel Limited - India
- Grasim Industreis Ltd - India
- SMG Consultants - Indonesia
- Economic Council, Georgia
- Intertek Mineral Services - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Deloitte Consulting - India
- Tata Chemicals Ltd - India
- Independent Power Producers Association of India
- LBH Netherlands Bv - Netherlands
- Borneo Indobara - Indonesia
- Electricity Authority, New Zealand
- Madhucon Powers Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mjunction Services Limited - India
- Aditya Birla Group - India
- Thiess Contractors Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ceylon Electricity Board - Sri Lanka
- Electricity Generating Authority of Thailand
- Metalloyd Limited - United Kingdom
- Siam City Cement PLC, Thailand
- Karaikal Port Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Bhatia International Limited - India
- Thai Mozambique Logistica
- Cement Manufacturers Association - India
- PowerSource Philippines DevCo
- McConnell Dowell - Australia
- Star Paper Mills Limited - India
- TeaM Sual Corporation - Philippines
- Price Waterhouse Coopers - Russia
- Parliament of New Zealand
- Uttam Galva Steels Limited - India
- Global Coal Blending Company Limited - Australia
- Krishnapatnam Port Company Ltd. - India
- Baramulti Group, Indonesia
- Binh Thuan Hamico - Vietnam
- Africa Commodities Group - South Africa
- Gujarat Electricity Regulatory Commission - India
- MS Steel International - UAE
- Kepco SPC Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Indian Energy Exchange, India
- Rashtriya Ispat Nigam Limited - India
- Rio Tinto Coal - Australia
- Malabar Cements Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Siam City Cement - Thailand
- GVK Power & Infra Limited - India
- Energy Link Ltd, New Zealand
- Singapore Mercantile Exchange
- Central Java Power - Indonesia
- Georgia Ports Authority, United States
- Kideco Jaya Agung - Indonesia
- Chettinad Cement Corporation Ltd - India
- Indogreen Group - Indonesia
- VISA Power Limited - India
- Sical Logistics Limited - India
- Semirara Mining and Power Corporation, Philippines
- Global Green Power PLC Corporation, Philippines
- Marubeni Corporation - India
- European Bulk Services B.V. - Netherlands
- Anglo American - United Kingdom
- International Coal Ventures Pvt Ltd - India
- Minerals Council of Australia
- Makarim & Taira - Indonesia
- PTC India Limited - India
- The State Trading Corporation of India Ltd
- Sarangani Energy Corporation, Philippines
- Standard Chartered Bank - UAE
- Meenaskhi Energy Private Limited - India
- Energy Development Corp, Philippines
- IEA Clean Coal Centre - UK
- OPG Power Generation Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Sinarmas Energy and Mining - Indonesia
- Larsen & Toubro Limited - India
- Leighton Contractors Pty Ltd - Australia
- Ind-Barath Power Infra Limited - India
- Ministry of Finance - Indonesia
- Sindya Power Generating Company Private Ltd
- Gujarat Mineral Development Corp Ltd - India
- Edison Trading Spa - Italy
- Renaissance Capital - South Africa
- Australian Commodity Traders Exchange
- Toyota Tsusho Corporation, Japan
- Kapuas Tunggal Persada - Indonesia
- Miang Besar Coal Terminal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Maheswari Brothers Coal Limited - India
- Tamil Nadu electricity Board
- Wilmar Investment Holdings
- Karbindo Abesyapradhi - Indoneisa
- Manunggal Multi Energi - Indonesia
- Jaiprakash Power Ventures ltd
- Bukit Asam (Persero) Tbk - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Parry Sugars Refinery, India
- Dalmia Cement Bharat India
- Maharashtra Electricity Regulatory Commission - India
- GAC Shipping (India) Pvt Ltd
- Therma Luzon, Inc, Philippines
- CIMB Investment Bank - Malaysia
- ICICI Bank Limited - India
- Mintek Dendrill Indonesia
- Mercuria Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Indian Oil Corporation Limited
- Sojitz Corporation - Japan
- TNB Fuel Sdn Bhd - Malaysia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- San Jose City I Power Corp, Philippines
- Samtan Co., Ltd - South Korea
- Semirara Mining Corp, Philippines
- Savvy Resources Ltd - HongKong
- Videocon Industries ltd - India
- Globalindo Alam Lestari - Indonesia
- London Commodity Brokers - England
- CNBM International Corporation - China
- Coal and Oil Company - UAE
- Bukit Makmur.PT - Indonesia
- Simpson Spence & Young - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Timah Investasi Mineral - Indoneisa
- Kalimantan Lumbung Energi - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Central Electricity Authority - India
- Antam Resourcindo - Indonesia
- Goldman Sachs - Singapore
- Formosa Plastics Group - Taiwan
- Kobexindo Tractors - Indoneisa
- IHS Mccloskey Coal Group - USA
- Wood Mackenzie - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Banpu Public Company Limited - Thailand
- Kaltim Prima Coal - Indonesia
- Vizag Seaport Private Limited - India
- The University of Queensland
- Chamber of Mines of South Africa
- Cigading International Bulk Terminal - Indonesia
- Directorate Of Revenue Intelligence - India
- Agrawal Coal Company - India
- Riau Bara Harum - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhoruka Overseas - Indonesia
- Bangladesh Power Developement Board
- Sakthi Sugars Limited - India
- Bulk Trading Sa - Switzerland
- White Energy Company Limited
- Trasteel International SA, Italy
- Pipit Mutiara Jaya. PT, Indonesia
- Coastal Gujarat Power Limited - India
- Australian Coal Association
- Indonesian Coal Mining Association
- Ambuja Cements Ltd - India
- New Zealand Coal & Carbon
- Attock Cement Pakistan Limited
- Oldendorff Carriers - Singapore
- Neyveli Lignite Corporation Ltd, - India
- Jindal Steel & Power Ltd - India
- Romanian Commodities Exchange
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Asmin Koalindo Tuhup - Indonesia
- ASAPP Information Group - India
- Power Finance Corporation Ltd., India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bahari Cakrawala Sebuku - Indonesia
- Gujarat Sidhee Cement - India
- Merrill Lynch Commodities Europe
- GN Power Mariveles Coal Plant, Philippines
- Interocean Group of Companies - India
- Kartika Selabumi Mining - Indonesia
- Latin American Coal - Colombia
- Pendopo Energi Batubara - Indonesia
- Barasentosa Lestari - Indonesia
- Vedanta Resources Plc - India
- Indo Tambangraya Megah - Indonesia
- Straits Asia Resources Limited - Singapore
- Carbofer General Trading SA - India
- Commonwealth Bank - Australia
- Port Waratah Coal Services - Australia
- Heidelberg Cement - Germany
- Indika Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- GMR Energy Limited - India
- SMC Global Power, Philippines
- Mercator Lines Limited - India
- Altura Mining Limited, Indonesia
- Eastern Energy - Thailand
- SN Aboitiz Power Inc, Philippines
- Lanco Infratech Ltd - India
- Aboitiz Power Corporation - Philippines
- Posco Energy - South Korea
- Sree Jayajothi Cements Limited - India
- Ministry of Transport, Egypt
- Petron Corporation, Philippines
- Kumho Petrochemical, South Korea
- Salva Resources Pvt Ltd - India
- Meralco Power Generation, Philippines
- Coalindo Energy - Indonesia
- Ministry of Mines - Canada
- Medco Energi Mining Internasional
- Planning Commission, India
- Orica Mining Services - Indonesia
- The Treasury - Australian Government
- Essar Steel Hazira Ltd - India
- PNOC Exploration Corporation - Philippines
- Eastern Coal Council - USA
- Bharathi Cement Corporation - India
- Global Business Power Corporation, Philippines
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