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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, 04 August 16
INDONESIAN COAL PRICES ARE STARTING TO ZOOM HIGHER; HBA ROSE 10.13% TO US$ 58.37 PER TON
COALspot.com: The Indonesia coal benchmark price hits to its highest level since August 2015.
The Director General of Mineral and Coa ...
Thursday, 04 August 16
BREXIT: IMPLICATIONS FOR GLOBAL SHIPPING AND SEA TRADE - EVERSHEDS
The buzzword for the post-Brexit landscape both in Europe and further afield is ‘uncertainty’. No-one really knows the long term effect ...
Wednesday, 03 August 16
RECAAP INFORMATION SHARING CENTRE ISSUES SPECIAL REPORT ON THE ABDUCTING OF CREW FROM SHIPS IN WATERS OFF EASTERN SABAH AND SOUTHERN PHILIPPINES - THE STANDARD CLUB
KNOWLEDGE TO ELEVATE
In the light of three incidents where the crew of tug boats were abducted in the waters off Eastern Sabah and Southern Ph ...
Wednesday, 03 August 16
SHIPPING MARKET INSIGHT - EVA TZIMA
The Good…
Demand. Amidst all the unprecedented geopolitical turmoil and shifts in the likes of Brexit, the IMF lowered last month its glob ...
Wednesday, 03 August 16
SHIP TRADING AND ORDERING CLOSE TO A STALEMATE AS SUMMER LULL KICKS IN
With newbuilding activity already at a near standstill since the start of the year, most of 2016’s trading activity in shipping was evident i ...
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- Vizag Seaport Private Limited - India
- Pendopo Energi Batubara - Indonesia
- Borneo Indobara - Indonesia
- Bhushan Steel Limited - India
- Bulk Trading Sa - Switzerland
- Attock Cement Pakistan Limited
- Planning Commission, India
- Indian Oil Corporation Limited
- Bank of Tokyo Mitsubishi UFJ Ltd
- Siam City Cement PLC, Thailand
- Salva Resources Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Meralco Power Generation, Philippines
- Larsen & Toubro Limited - India
- Kepco SPC Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Bukit Baiduri Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- SN Aboitiz Power Inc, Philippines
- Independent Power Producers Association of India
- Edison Trading Spa - Italy
- PowerSource Philippines DevCo
- Uttam Galva Steels Limited - India
- Baramulti Group, Indonesia
- Binh Thuan Hamico - Vietnam
- Altura Mining Limited, Indonesia
- Renaissance Capital - South Africa
- Bukit Asam (Persero) Tbk - Indonesia
- Intertek Mineral Services - Indonesia
- Maheswari Brothers Coal Limited - India
- Georgia Ports Authority, United States
- Alfred C Toepfer International GmbH - Germany
- Energy Development Corp, Philippines
- Gujarat Sidhee Cement - India
- Trasteel International SA, Italy
- Samtan Co., Ltd - South Korea
- Agrawal Coal Company - India
- Ind-Barath Power Infra Limited - India
- Bharathi Cement Corporation - India
- Wilmar Investment Holdings
- CNBM International Corporation - China
- Jindal Steel & Power Ltd - India
- Singapore Mercantile Exchange
- McConnell Dowell - Australia
- Kartika Selabumi Mining - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Romanian Commodities Exchange
- Riau Bara Harum - Indonesia
- Malabar Cements Ltd - India
- Miang Besar Coal Terminal - Indonesia
- IEA Clean Coal Centre - UK
- Asmin Koalindo Tuhup - Indonesia
- Chamber of Mines of South Africa
- Directorate Of Revenue Intelligence - India
- Neyveli Lignite Corporation Ltd, - India
- Ministry of Mines - Canada
- Grasim Industreis Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Global Coal Blending Company Limited - Australia
- The University of Queensland
- Videocon Industries ltd - India
- Kobexindo Tractors - Indoneisa
- Port Waratah Coal Services - Australia
- Mercuria Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Wood Mackenzie - Singapore
- Kumho Petrochemical, South Korea
- Global Green Power PLC Corporation, Philippines
- Orica Mining Services - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Coalindo Energy - Indonesia
- Price Waterhouse Coopers - Russia
- Australian Coal Association
- Tamil Nadu electricity Board
- MS Steel International - UAE
- Mintek Dendrill Indonesia
- Anglo American - United Kingdom
- Directorate General of MIneral and Coal - Indonesia
- Thai Mozambique Logistica
- ASAPP Information Group - India
- Semirara Mining and Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Standard Chartered Bank - UAE
- Semirara Mining Corp, Philippines
- Dalmia Cement Bharat India
- Sojitz Corporation - Japan
- Globalindo Alam Lestari - Indonesia
- Power Finance Corporation Ltd., India
- New Zealand Coal & Carbon
- Siam City Cement - Thailand
- Bahari Cakrawala Sebuku - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Straits Asia Resources Limited - Singapore
- Simpson Spence & Young - Indonesia
- GVK Power & Infra Limited - India
- Cement Manufacturers Association - India
- Ambuja Cements Ltd - India
- Africa Commodities Group - South Africa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Thiess Contractors Indonesia
- Goldman Sachs - Singapore
- London Commodity Brokers - England
- Chettinad Cement Corporation Ltd - India
- South Luzon Thermal Energy Corporation
- Bhatia International Limited - India
- Indonesian Coal Mining Association
- Iligan Light & Power Inc, Philippines
- Australian Commodity Traders Exchange
- Economic Council, Georgia
- Aboitiz Power Corporation - Philippines
- ICICI Bank Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Central Electricity Authority - India
- Sindya Power Generating Company Private Ltd
- Petron Corporation, Philippines
- Essar Steel Hazira Ltd - India
- SMG Consultants - Indonesia
- Sical Logistics Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Finance - Indonesia
- Kaltim Prima Coal - Indonesia
- TeaM Sual Corporation - Philippines
- VISA Power Limited - India
- White Energy Company Limited
- Ministry of Transport, Egypt
- Savvy Resources Ltd - HongKong
- Indogreen Group - Indonesia
- Meenaskhi Energy Private Limited - India
- Energy Link Ltd, New Zealand
- Coal and Oil Company - UAE
- Global Business Power Corporation, Philippines
- Merrill Lynch Commodities Europe
- Kalimantan Lumbung Energi - Indonesia
- OPG Power Generation Pvt Ltd - India
- Bangladesh Power Developement Board
- Xindia Steels Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Rio Tinto Coal - Australia
- Toyota Tsusho Corporation, Japan
- Heidelberg Cement - Germany
- Banpu Public Company Limited - Thailand
- Tata Chemicals Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Eastern Coal Council - USA
- India Bulls Power Limited - India
- PNOC Exploration Corporation - Philippines
- SMC Global Power, Philippines
- Parry Sugars Refinery, India
- Aditya Birla Group - India
- Indo Tambangraya Megah - Indonesia
- IHS Mccloskey Coal Group - USA
- Antam Resourcindo - Indonesia
- Indika Energy - Indonesia
- Makarim & Taira - Indonesia
- Star Paper Mills Limited - India
- Commonwealth Bank - Australia
- GAC Shipping (India) Pvt Ltd
- Sarangani Energy Corporation, Philippines
- Posco Energy - South Korea
- Manunggal Multi Energi - Indonesia
- Interocean Group of Companies - India
- CIMB Investment Bank - Malaysia
- Maharashtra Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- Krishnapatnam Port Company Ltd. - India
- Gujarat Mineral Development Corp Ltd - India
- Mjunction Services Limited - India
- Oldendorff Carriers - Singapore
- Timah Investasi Mineral - Indoneisa
- Central Java Power - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Medco Energi Mining Internasional
- Sakthi Sugars Limited - India
- Orica Australia Pty. Ltd.
- Bayan Resources Tbk. - Indonesia
- Formosa Plastics Group - Taiwan
- Jaiprakash Power Ventures ltd
- Minerals Council of Australia
- European Bulk Services B.V. - Netherlands
- Metalloyd Limited - United Kingdom
- Eastern Energy - Thailand
- The State Trading Corporation of India Ltd
- Kohat Cement Company Ltd. - Pakistan
- PTC India Limited - India
- Coastal Gujarat Power Limited - India
- Bukit Makmur.PT - Indonesia
- Lanco Infratech Ltd - India
- LBH Netherlands Bv - Netherlands
- Sinarmas Energy and Mining - Indonesia
- Karaikal Port Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- San Jose City I Power Corp, Philippines
- Parliament of New Zealand
- The Treasury - Australian Government
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Carbofer General Trading SA - India
- Bhoruka Overseas - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Vedanta Resources Plc - India
- Electricity Authority, New Zealand
- Madhucon Powers Ltd - India
- Kideco Jaya Agung - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Mercator Lines Limited - India
- Indian Energy Exchange, India
- Barasentosa Lestari - Indonesia
- Deloitte Consulting - India
- Ceylon Electricity Board - Sri Lanka
- Pipit Mutiara Jaya. PT, Indonesia
- AsiaOL BioFuels Corp., Philippines
- GMR Energy Limited - India
- International Coal Ventures Pvt Ltd - India
- Electricity Generating Authority of Thailand
- Leighton Contractors Pty Ltd - Australia
- Marubeni Corporation - India
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