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Friday, 16 March 18
INDONESIA COAL PRICE CAP POSES LIMITED RISKS TO PRODUCERS : FITCH
 Indonesia’s cap on the benchmark price of coal sold to the domestic electricity sector is unlikely to have a significant impact on the credit profiles of Fitch-rated mining firms, which export most of their production, says Fitch Ratings. In any case, our ratings are based on average benchmark price forecasts that are broadly in line with the cap of USD70/tonne imposed until end-2019, and so will not be affected.
The price cap, announced last week and set to apply from mid-March, is part of the government’s strategy to ensure low prices for electricity consumers as it looks to support industrial competitiveness and household disposable incomes. It froze electricity prices charged to industrial consumers earlier in the year, preventing Perusahaan Listrik Negara (PLN), the state-owned monopoly distributor, from passing on rising costs as coal prices were pushed up by an unusually cold Chinese winter. The Indonesian coal price benchmark, Harga Batubara Acuan (HBA), has exceeded USD95/tonne since January 2018, which might have necessitated an increase in government subsidies to PLN if the price cap had not been imposed.
The new regulations will mean coal miners miss out on some of the short-term upside from high prevailing coal prices, to the extent that they sell production to the domestic market. The government sets domestic market obligations for miners to ensure they meet local demand, which prevents them from simply diverting output toward the overseas market.
That said, only around one-fifth of Indonesia’s 461 million tonnes of coal production was sold in the domestic market in 2017, which suggests any loss of revenue will be limited. Indika would be the most affected among our rated coal miners, as around 15% of its volumes are sold to the domestic power sector. GEO Energy, Golden Energy Resources, ABM Investama and PT Toba Bara sell less than 10% of volumes to the domestic power sector. Domestic market obligations are likely to increase over the medium term, as the government looks to contain production and conserve coal resources for local power needs, but a sharp rise next year is unlikely.
Coal firms will therefore continue to receive the market price for the majority of their production. As a result, their financial performance might still exceed our expectations at the start of the year, when we had forecast an average Newcastle benchmark (6000 kcal) price of USD72/tonne in 2018 and USD67/tonne in 2019. The HBA on which the regulations are based broadly reflect Newcastle prices.
The new price regime does not include a floor on prices, and so provides no benefit to the mining firms in the event of a downturn. Prices will continue to fluctuate as before if the market price drops below USD70/tonne.
The price ceiling is unlikely to have any meaningful impact on PLN’s standalone credit profile. We would have expected the government to compensate PLN for losses through subsidies if high coal prices and fixed electricity prices had caused under recoveries. PLN’s IDR of ‘BBB’ is equalised with the sovereign rating due to its very strong government linkages.
Source: Fitch Ratings
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Wednesday, 18 April 18
SHIPPING MARKET INSIGHT - STELIOS KOLLINTZAS
The return of traders and charterers from the Easter festivities came along with a slight increase in activity across the edible oil markets. Howev ...
Monday, 16 April 18
MINISTER IGNASIUS JONAN SPEAKS HIS MIND AT INDONESIA MINER - IAN WOLLFF
The Minister for Energy and Mineral resources, Ignasius Jonan, delivered a key note address at the Indonesia Miner conference in Jakarta on the 11 ...
Thursday, 12 April 18
THE PERFECT STORM FOR THE BIG SHIPS - THE BALTIC BRIEFING
Capesize
The perfect storm for the big ships: with holidays, force majeure in two ore exporting ports and bad weather undermining the market. A l ...
Thursday, 12 April 18
SHIPPING CAN MANAGE US-CHINA TARIFFS, BUT RISKS RISING - FITCH
Container and, to some extent, dry bulk would probably be the shipping segments most affected by the recently announced US and China tariffs, Fitch ...
Thursday, 12 April 18
SUPRAS HAVE FIXED MID $11K FOR AN INDO RV TO S. CHINA DELIVERY PHILIPPINES - FEARNLEYS
Supramax
Slow week with little light for improving rates. ECSA to Far East still around $15k + bb and same to Med ca $14k, says Fearnleys in its ...
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- Ministry of Transport, Egypt
- Tata Chemicals Ltd - India
- McConnell Dowell - Australia
- New Zealand Coal & Carbon
- Cement Manufacturers Association - India
- Aboitiz Power Corporation - Philippines
- Mercator Lines Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Lanco Infratech Ltd - India
- Sarangani Energy Corporation, Philippines
- Aditya Birla Group - India
- Kaltim Prima Coal - Indonesia
- Mercuria Energy - Indonesia
- TeaM Sual Corporation - Philippines
- Kapuas Tunggal Persada - Indonesia
- Port Waratah Coal Services - Australia
- Power Finance Corporation Ltd., India
- Metalloyd Limited - United Kingdom
- India Bulls Power Limited - India
- San Jose City I Power Corp, Philippines
- Minerals Council of Australia
- TNB Fuel Sdn Bhd - Malaysia
- Wilmar Investment Holdings
- Krishnapatnam Port Company Ltd. - India
- Orica Australia Pty. Ltd.
- Essar Steel Hazira Ltd - India
- Kartika Selabumi Mining - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Mjunction Services Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Directorate Of Revenue Intelligence - India
- Coalindo Energy - Indonesia
- Toyota Tsusho Corporation, Japan
- Coal and Oil Company - UAE
- Global Green Power PLC Corporation, Philippines
- Merrill Lynch Commodities Europe
- ASAPP Information Group - India
- Eastern Coal Council - USA
- Manunggal Multi Energi - Indonesia
- Semirara Mining and Power Corporation, Philippines
- The Treasury - Australian Government
- Karaikal Port Pvt Ltd - India
- Chamber of Mines of South Africa
- Sakthi Sugars Limited - India
- Electricity Authority, New Zealand
- Star Paper Mills Limited - India
- Standard Chartered Bank - UAE
- PetroVietnam Power Coal Import and Supply Company
- Meenaskhi Energy Private Limited - India
- Bayan Resources Tbk. - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Eastern Energy - Thailand
- Ministry of Mines - Canada
- SMC Global Power, Philippines
- Billiton Holdings Pty Ltd - Australia
- Carbofer General Trading SA - India
- Iligan Light & Power Inc, Philippines
- Trasteel International SA, Italy
- Timah Investasi Mineral - Indoneisa
- Sree Jayajothi Cements Limited - India
- Makarim & Taira - Indonesia
- ICICI Bank Limited - India
- Sojitz Corporation - Japan
- Jindal Steel & Power Ltd - India
- South Luzon Thermal Energy Corporation
- Siam City Cement - Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Xindia Steels Limited - India
- Ministry of Finance - Indonesia
- Chettinad Cement Corporation Ltd - India
- Maheswari Brothers Coal Limited - India
- Samtan Co., Ltd - South Korea
- Bahari Cakrawala Sebuku - Indonesia
- Goldman Sachs - Singapore
- SN Aboitiz Power Inc, Philippines
- Coastal Gujarat Power Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Ceylon Electricity Board - Sri Lanka
- Planning Commission, India
- CNBM International Corporation - China
- Larsen & Toubro Limited - India
- Sical Logistics Limited - India
- IEA Clean Coal Centre - UK
- Altura Mining Limited, Indonesia
- Meralco Power Generation, Philippines
- Kepco SPC Power Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Straits Asia Resources Limited - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Kobexindo Tractors - Indoneisa
- Mintek Dendrill Indonesia
- Indian Energy Exchange, India
- SMG Consultants - Indonesia
- Thiess Contractors Indonesia
- Rio Tinto Coal - Australia
- Directorate General of MIneral and Coal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- CIMB Investment Bank - Malaysia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indika Energy - Indonesia
- GVK Power & Infra Limited - India
- Agrawal Coal Company - India
- Siam City Cement PLC, Thailand
- Antam Resourcindo - Indonesia
- VISA Power Limited - India
- Central Electricity Authority - India
- Vedanta Resources Plc - India
- Savvy Resources Ltd - HongKong
- Kideco Jaya Agung - Indonesia
- Malabar Cements Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Attock Cement Pakistan Limited
- Oldendorff Carriers - Singapore
- Parry Sugars Refinery, India
- Deloitte Consulting - India
- Renaissance Capital - South Africa
- Africa Commodities Group - South Africa
- Kumho Petrochemical, South Korea
- Formosa Plastics Group - Taiwan
- Bhushan Steel Limited - India
- Kohat Cement Company Ltd. - Pakistan
- GAC Shipping (India) Pvt Ltd
- Binh Thuan Hamico - Vietnam
- Anglo American - United Kingdom
- Intertek Mineral Services - Indonesia
- Videocon Industries ltd - India
- Sinarmas Energy and Mining - Indonesia
- Vizag Seaport Private Limited - India
- PowerSource Philippines DevCo
- Alfred C Toepfer International GmbH - Germany
- Price Waterhouse Coopers - Russia
- Dalmia Cement Bharat India
- Jorong Barutama Greston.PT - Indonesia
- Sindya Power Generating Company Private Ltd
- Bangladesh Power Developement Board
- LBH Netherlands Bv - Netherlands
- Gujarat Sidhee Cement - India
- Marubeni Corporation - India
- Pipit Mutiara Jaya. PT, Indonesia
- Global Business Power Corporation, Philippines
- Bhatia International Limited - India
- Indo Tambangraya Megah - Indonesia
- Madhucon Powers Ltd - India
- Therma Luzon, Inc, Philippines
- Singapore Mercantile Exchange
- Edison Trading Spa - Italy
- Thai Mozambique Logistica
- Ambuja Cements Ltd - India
- Interocean Group of Companies - India
- Petron Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- Barasentosa Lestari - Indonesia
- London Commodity Brokers - England
- European Bulk Services B.V. - Netherlands
- Medco Energi Mining Internasional
- Electricity Generating Authority of Thailand
- Tamil Nadu electricity Board
- Banpu Public Company Limited - Thailand
- Karbindo Abesyapradhi - Indoneisa
- Indian Oil Corporation Limited
- Ind-Barath Power Infra Limited - India
- Bulk Trading Sa - Switzerland
- Rashtriya Ispat Nigam Limited - India
- International Coal Ventures Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Bharathi Cement Corporation - India
- White Energy Company Limited
- Baramulti Group, Indonesia
- Central Java Power - Indonesia
- PTC India Limited - India
- Holcim Trading Pte Ltd - Singapore
- Bukit Makmur.PT - Indonesia
- Bukit Baiduri Energy - Indonesia
- Independent Power Producers Association of India
- Petrochimia International Co. Ltd.- Taiwan
- Grasim Industreis Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Salva Resources Pvt Ltd - India
- Heidelberg Cement - Germany
- Global Coal Blending Company Limited - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Commonwealth Bank - Australia
- Parliament of New Zealand
- IHS Mccloskey Coal Group - USA
- MS Steel International - UAE
- Semirara Mining Corp, Philippines
- Romanian Commodities Exchange
- Simpson Spence & Young - Indonesia
- Energy Link Ltd, New Zealand
- Bhoruka Overseas - Indonesia
- Globalindo Alam Lestari - Indonesia
- Indogreen Group - Indonesia
- Borneo Indobara - Indonesia
- OPG Power Generation Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PNOC Exploration Corporation - Philippines
- The State Trading Corporation of India Ltd
- Uttam Galva Steels Limited - India
- Wood Mackenzie - Singapore
- Posco Energy - South Korea
- Pendopo Energi Batubara - Indonesia
- Jaiprakash Power Ventures ltd
- The University of Queensland
- Economic Council, Georgia
- Australian Commodity Traders Exchange
- Australian Coal Association
- Energy Development Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Orica Mining Services - Indonesia
- Latin American Coal - Colombia
- Indonesian Coal Mining Association
- Riau Bara Harum - Indonesia
- GMR Energy Limited - India
- Georgia Ports Authority, United States
- Neyveli Lignite Corporation Ltd, - India
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