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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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Thursday, 10 November 16
WILL TRUMP VICTORY PROVIDE A BOOST FOR HYDROCARBON & COAL INDUSTRIES? - DOUGLAS-WESTWOOD
Donald Trump’s surprise victory ends months of an adversarial presidential campaign with bitter disagreements between the two major candidate ...
Thursday, 10 November 16
PANAMAX: NO TRUMP INFLUENCE YET, AND THE MARKET IS HEADING NORTH - FEARNLEYS
Supramax
Pacific Supra market still soft and falling this week, although seems to be in a somewhat slower pace compared to last week. According t ...
Wednesday, 09 November 16
SINGAPORE'S SGX COMPLETES ACQUISITION OF LONDON'S BALTIC EXCHANGE
COALspot.com: Singapore Exchange Limited and The Baltic Exchange Limited together announced that the acquisition of the Baltic Exchange by SGX has ...
Wednesday, 09 November 16
SUPRAMAX: 50% INCREASE ON AVERAGE SINCE THE FIRST QUARTER OF THE YEAR - GIANNIS ANDRITSOPOULOS
Last week was an interesting one for the tanker market, which following the explosion of the gas pipeline in Alabama witnessed a spike in Atlantic ...
Tuesday, 08 November 16
S.KOREA'S KOMIPO ISSUES TENDER TO BUY 390K TONS OF BITUMINOUS COAL FOR JAN-FEB 2017
COALspot.com: South Korea state-owned utility Korea Midland Power (KOMIPO) issued a new tender for 390,000 Metric Tons of Bituminous Coal for its B ...
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- San Jose City I Power Corp, Philippines
- Semirara Mining Corp, Philippines
- TeaM Sual Corporation - Philippines
- Kideco Jaya Agung - Indonesia
- GAC Shipping (India) Pvt Ltd
- Mercuria Energy - Indonesia
- Ambuja Cements Ltd - India
- Power Finance Corporation Ltd., India
- Tamil Nadu electricity Board
- Orica Mining Services - Indonesia
- Anglo American - United Kingdom
- Simpson Spence & Young - Indonesia
- Bhoruka Overseas - Indonesia
- Aditya Birla Group - India
- Samtan Co., Ltd - South Korea
- IHS Mccloskey Coal Group - USA
- Mjunction Services Limited - India
- Pendopo Energi Batubara - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Ministry of Transport, Egypt
- Ind-Barath Power Infra Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- ASAPP Information Group - India
- Rio Tinto Coal - Australia
- Chettinad Cement Corporation Ltd - India
- CIMB Investment Bank - Malaysia
- Bukit Baiduri Energy - Indonesia
- Antam Resourcindo - Indonesia
- The Treasury - Australian Government
- New Zealand Coal & Carbon
- Global Green Power PLC Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- PNOC Exploration Corporation - Philippines
- Romanian Commodities Exchange
- Lanco Infratech Ltd - India
- Sarangani Energy Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Minerals Council of Australia
- Madhucon Powers Ltd - India
- Bhatia International Limited - India
- IEA Clean Coal Centre - UK
- Krishnapatnam Port Company Ltd. - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Coalindo Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- International Coal Ventures Pvt Ltd - India
- Larsen & Toubro Limited - India
- Indonesian Coal Mining Association
- Pipit Mutiara Jaya. PT, Indonesia
- South Luzon Thermal Energy Corporation
- Indogreen Group - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Electricity Authority, New Zealand
- Kartika Selabumi Mining - Indonesia
- Wood Mackenzie - Singapore
- Savvy Resources Ltd - HongKong
- Siam City Cement - Thailand
- Therma Luzon, Inc, Philippines
- Maheswari Brothers Coal Limited - India
- The State Trading Corporation of India Ltd
- Parliament of New Zealand
- Planning Commission, India
- Jorong Barutama Greston.PT - Indonesia
- OPG Power Generation Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- Cigading International Bulk Terminal - Indonesia
- Agrawal Coal Company - India
- Vedanta Resources Plc - India
- Price Waterhouse Coopers - Russia
- Chamber of Mines of South Africa
- Thiess Contractors Indonesia
- Electricity Generating Authority of Thailand
- Orica Australia Pty. Ltd.
- Parry Sugars Refinery, India
- India Bulls Power Limited - India
- Posco Energy - South Korea
- CNBM International Corporation - China
- Essar Steel Hazira Ltd - India
- Merrill Lynch Commodities Europe
- Leighton Contractors Pty Ltd - Australia
- Iligan Light & Power Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- Bangladesh Power Developement Board
- Deloitte Consulting - India
- Jaiprakash Power Ventures ltd
- Vijayanagar Sugar Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Jindal Steel & Power Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- SMG Consultants - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Xindia Steels Limited - India
- Central Electricity Authority - India
- Bahari Cakrawala Sebuku - Indonesia
- Kepco SPC Power Corporation, Philippines
- SMC Global Power, Philippines
- PowerSource Philippines DevCo
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Heidelberg Cement - Germany
- Kohat Cement Company Ltd. - Pakistan
- Dalmia Cement Bharat India
- Meenaskhi Energy Private Limited - India
- Coal and Oil Company - UAE
- ICICI Bank Limited - India
- Independent Power Producers Association of India
- Makarim & Taira - Indonesia
- Commonwealth Bank - Australia
- Rashtriya Ispat Nigam Limited - India
- Global Business Power Corporation, Philippines
- Baramulti Group, Indonesia
- Africa Commodities Group - South Africa
- Holcim Trading Pte Ltd - Singapore
- Vizag Seaport Private Limited - India
- Trasteel International SA, Italy
- Barasentosa Lestari - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Uttam Galva Steels Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Petron Corporation, Philippines
- Port Waratah Coal Services - Australia
- Maharashtra Electricity Regulatory Commission - India
- Tata Chemicals Ltd - India
- Riau Bara Harum - Indonesia
- Renaissance Capital - South Africa
- Mercator Lines Limited - India
- McConnell Dowell - Australia
- Directorate General of MIneral and Coal - Indonesia
- Salva Resources Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Singapore Mercantile Exchange
- Grasim Industreis Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Sakthi Sugars Limited - India
- Thai Mozambique Logistica
- Cement Manufacturers Association - India
- Marubeni Corporation - India
- Kobexindo Tractors - Indoneisa
- Miang Besar Coal Terminal - Indonesia
- Malabar Cements Ltd - India
- Gujarat Sidhee Cement - India
- Coastal Gujarat Power Limited - India
- Medco Energi Mining Internasional
- Standard Chartered Bank - UAE
- Altura Mining Limited, Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Alfred C Toepfer International GmbH - Germany
- Eastern Coal Council - USA
- Kaltim Prima Coal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ministry of Finance - Indonesia
- Toyota Tsusho Corporation, Japan
- Oldendorff Carriers - Singapore
- Kumho Petrochemical, South Korea
- Aboitiz Power Corporation - Philippines
- European Bulk Services B.V. - Netherlands
- Indo Tambangraya Megah - Indonesia
- Banpu Public Company Limited - Thailand
- Metalloyd Limited - United Kingdom
- Bhushan Steel Limited - India
- Borneo Indobara - Indonesia
- Sojitz Corporation - Japan
- Kalimantan Lumbung Energi - Indonesia
- Australian Commodity Traders Exchange
- Timah Investasi Mineral - Indoneisa
- Carbofer General Trading SA - India
- Petrochimia International Co. Ltd.- Taiwan
- Energy Development Corp, Philippines
- Eastern Energy - Thailand
- GVK Power & Infra Limited - India
- Goldman Sachs - Singapore
- Directorate Of Revenue Intelligence - India
- SN Aboitiz Power Inc, Philippines
- Indian Oil Corporation Limited
- GMR Energy Limited - India
- Attock Cement Pakistan Limited
- Karaikal Port Pvt Ltd - India
- Latin American Coal - Colombia
- Bulk Trading Sa - Switzerland
- AsiaOL BioFuels Corp., Philippines
- Australian Coal Association
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sindya Power Generating Company Private Ltd
- Semirara Mining and Power Corporation, Philippines
- Georgia Ports Authority, United States
- Interocean Group of Companies - India
- Manunggal Multi Energi - Indonesia
- Edison Trading Spa - Italy
- Wilmar Investment Holdings
- Sree Jayajothi Cements Limited - India
- PTC India Limited - India
- VISA Power Limited - India
- MS Steel International - UAE
- Indika Energy - Indonesia
- The University of Queensland
- White Energy Company Limited
- TNB Fuel Sdn Bhd - Malaysia
- Central Java Power - Indonesia
- London Commodity Brokers - England
- Mintek Dendrill Indonesia
- Straits Asia Resources Limited - Singapore
- Global Coal Blending Company Limited - Australia
- Meralco Power Generation, Philippines
- Bukit Makmur.PT - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Billiton Holdings Pty Ltd - Australia
- Bharathi Cement Corporation - India
- Intertek Mineral Services - Indonesia
- Videocon Industries ltd - India
- Indian Energy Exchange, India
- Economic Council, Georgia
- Sical Logistics Limited - India
- Ministry of Mines - Canada
- Star Paper Mills Limited - India
- Siam City Cement PLC, Thailand
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