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Friday, 28 September 18
FITCH RATINGS: METALLURGICAL COAL MINERS MAY CURB COSTS AS PRICES SLIP
Strong cost inflation in the global metallurgical coal sector suggests that miners may focus on cost controls as prices decline from their current high levels over the next 18 months, say Fitch Ratings and CRU. However, mining companies rated by Fitch are well-positioned for any potential squeeze on margins, as their costs are relatively low by global standards and, in most cases, their diversified business operations limit exposure to the sector.
CRU estimates that global costs in the metallurgical coal sector increased by 18% in 2017 and continued to rise in 2018. Severe weather has played a role in Australia, causing supply-chain disruption that led to demurrage penalties and increased storage costs for unshipped coal. However, costs have also been pushed up globally by higher oil prices and attempts by mining companies to maximise production to take advantage of high prices.
Coking coal prices are currently sufficiently high that cost inflation has not undermined profitability. CRU estimates that the seaborne industry generated an average cash margin of 40% in 2016-2017, and profitability has remained very strong this year.
The metallurgical coal market is unlikely to become oversupplied in the near term, and Fitch does not expect prices to fall deep into the cost curve, as they did during 2014-2016. However, prices have already eased off from their peak of USD260/tonne in 4Q16, and are likely to decline further as supply constraints continue to ease. Fitch’s current assumptions are that hard coking coal prices will average USD185/tonne this year and USD140/tonne thereafter. These declines could put pressure on some less competitive mining companies to reduce costs to protect margins.
Among Fitch-rated companies, Teck Resources (BB+/Positive) has the largest exposure to the metallurgical coal sector, which accounted for 60% of its segment EBITDA in the 12 months to 30 June 2018. The company is among those that have increased use of contractors and rented more mining equipment to raise short-term output, which has pushed up marginal costs. Nevertheless, Teck is still in the lower half of the global cost curve (FOB port) and its costs remain lower in US dollar terms than in 2014. Teck has also taken advantage of strong margins and cash flow to reduce leverage. The main credit issue facing the company is the prospect of continued project spending and its funding resulting in weaker cash flows and higher financial leverage.
BHP Billiton (A/Stable) and Anglo American (BBB-/Stable) also have significant metallurgical coal assets, mostly located in Australia, where coal mines are generally relatively low cost by global standards. BHP and Anglo also have diversified operations, with metallurgical coal accounting for only around 16% of BHP Billiton’s revenue and 17% of Anglo’s in the financial year ending June 2017. There could be increased focus on improving efficiency in the Australian coal sector, as already signalled by some companies, but CRU and the Australian government expect production to continue to grow strongly over the next four years.
Meanwhile, mining service companies and earthmoving equipment manufacturers should continue to benefit from rising demand and a better pricing environment as miners continue with new projects and increase production. Emeco (B/Stable), which has the largest exposure to metallurgical coal among Fitch-rated companies, reported improved EBITDA margin as the commodity sector recovered. It also improved its leverage position. Further leverage improvements are likely in 2019-2021 due to equity-funded acquisitions and a tight rental equipment market in Australia.
Source: Fitch Ratings
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Tuesday, 10 July 18
SHIPPING MARKET ANALYSIS - GEORGE LAZARIDIS
The trade dispute saga continued over the past week, as new tariffs were put into force on Friday in both the U.S. and China and have already taken ...
Tuesday, 10 July 18
SUPPORTING SULPHUR 2020 CONSISTENT IMPLEMENTATION - IMO
An IMO working group is meeting (9-13 July) to develop guidelines to support the consistent implementation of the 0.50% limit for the sulphur conte ...
Monday, 09 July 18
RISING COAL PRICES LIFTING AUSTRALIA'S EXPORT REVENUES BUT INVESTORS STAYING AWAY - NEWCASTLE HERALD
Newcastle coal prices have risen more than 40 per cent in a year to be at their highest levels for seven years but the industry is becoming increas ...
Saturday, 07 July 18
SUPRAMAX: THE ASIAN MARKET STRUGGLED; A 57K-DWT WAS REPORTED FIXED BASIS DELIVERY SINGAPORE FOR A TRIP VIA INDONESIA REDELIVERY INDIA AT $12K
Capesize
A punchy week for the big ships that saw Atlantic rates soar, with the tonnage list tight prompting charterers to split cargoes, thoug ...
Friday, 06 July 18
COAL PRICES HAVE REMAINED STRONG BUT ARE SET TO DECLINE - NAB
Coal spot prices have been highly volatile in recent years, with an upward trend since recent lows in April 2018, National Australia Bank says in i ...
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Showing 1671 to 1675 news of total 6871 |
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- Central Java Power - Indonesia
- Salva Resources Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- India Bulls Power Limited - India
- Renaissance Capital - South Africa
- Singapore Mercantile Exchange
- Chamber of Mines of South Africa
- Coalindo Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Miang Besar Coal Terminal - Indonesia
- Samtan Co., Ltd - South Korea
- Sical Logistics Limited - India
- Port Waratah Coal Services - Australia
- Global Coal Blending Company Limited - Australia
- Kobexindo Tractors - Indoneisa
- Ministry of Transport, Egypt
- Maheswari Brothers Coal Limited - India
- Global Business Power Corporation, Philippines
- Standard Chartered Bank - UAE
- Wilmar Investment Holdings
- PNOC Exploration Corporation - Philippines
- Trasteel International SA, Italy
- Kalimantan Lumbung Energi - Indonesia
- Eastern Coal Council - USA
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- TeaM Sual Corporation - Philippines
- Bangladesh Power Developement Board
- Mintek Dendrill Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Aditya Birla Group - India
- Anglo American - United Kingdom
- Indogreen Group - Indonesia
- Borneo Indobara - Indonesia
- Riau Bara Harum - Indonesia
- Ambuja Cements Ltd - India
- Siam City Cement - Thailand
- Savvy Resources Ltd - HongKong
- SMC Global Power, Philippines
- Indian Energy Exchange, India
- Timah Investasi Mineral - Indoneisa
- Krishnapatnam Port Company Ltd. - India
- Bahari Cakrawala Sebuku - Indonesia
- Bukit Baiduri Energy - Indonesia
- Goldman Sachs - Singapore
- VISA Power Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Makarim & Taira - Indonesia
- IEA Clean Coal Centre - UK
- Australian Commodity Traders Exchange
- TNB Fuel Sdn Bhd - Malaysia
- Oldendorff Carriers - Singapore
- Thiess Contractors Indonesia
- Meenaskhi Energy Private Limited - India
- Gujarat Electricity Regulatory Commission - India
- Ministry of Finance - Indonesia
- GVK Power & Infra Limited - India
- Electricity Generating Authority of Thailand
- SMG Consultants - Indonesia
- Kartika Selabumi Mining - Indonesia
- CNBM International Corporation - China
- Holcim Trading Pte Ltd - Singapore
- Offshore Bulk Terminal Pte Ltd, Singapore
- Banpu Public Company Limited - Thailand
- SN Aboitiz Power Inc, Philippines
- Mercator Lines Limited - India
- Formosa Plastics Group - Taiwan
- The State Trading Corporation of India Ltd
- New Zealand Coal & Carbon
- GN Power Mariveles Coal Plant, Philippines
- CIMB Investment Bank - Malaysia
- Cigading International Bulk Terminal - Indonesia
- White Energy Company Limited
- GAC Shipping (India) Pvt Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Tamil Nadu electricity Board
- Kaltim Prima Coal - Indonesia
- The University of Queensland
- Aboitiz Power Corporation - Philippines
- Orica Australia Pty. Ltd.
- Coal and Oil Company - UAE
- Tata Chemicals Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Directorate Of Revenue Intelligence - India
- Karbindo Abesyapradhi - Indoneisa
- Grasim Industreis Ltd - India
- OPG Power Generation Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- European Bulk Services B.V. - Netherlands
- Jindal Steel & Power Ltd - India
- Bharathi Cement Corporation - India
- Energy Link Ltd, New Zealand
- Pendopo Energi Batubara - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Chettinad Cement Corporation Ltd - India
- Essar Steel Hazira Ltd - India
- Videocon Industries ltd - India
- Africa Commodities Group - South Africa
- Indo Tambangraya Megah - Indonesia
- PowerSource Philippines DevCo
- Orica Mining Services - Indonesia
- Bayan Resources Tbk. - Indonesia
- Globalindo Alam Lestari - Indonesia
- Antam Resourcindo - Indonesia
- Indian Oil Corporation Limited
- Planning Commission, India
- Interocean Group of Companies - India
- Binh Thuan Hamico - Vietnam
- Bhushan Steel Limited - India
- Toyota Tsusho Corporation, Japan
- Marubeni Corporation - India
- Coastal Gujarat Power Limited - India
- Wood Mackenzie - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhoruka Overseas - Indonesia
- Semirara Mining Corp, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sojitz Corporation - Japan
- Australian Coal Association
- Parliament of New Zealand
- Vizag Seaport Private Limited - India
- International Coal Ventures Pvt Ltd - India
- Independent Power Producers Association of India
- South Luzon Thermal Energy Corporation
- Petrochimia International Co. Ltd.- Taiwan
- Altura Mining Limited, Indonesia
- ASAPP Information Group - India
- Maharashtra Electricity Regulatory Commission - India
- Energy Development Corp, Philippines
- Neyveli Lignite Corporation Ltd, - India
- AsiaOL BioFuels Corp., Philippines
- Kohat Cement Company Ltd. - Pakistan
- Rio Tinto Coal - Australia
- Billiton Holdings Pty Ltd - Australia
- Baramulti Group, Indonesia
- McConnell Dowell - Australia
- Leighton Contractors Pty Ltd - Australia
- The Treasury - Australian Government
- ICICI Bank Limited - India
- Romanian Commodities Exchange
- Economic Council, Georgia
- Carbofer General Trading SA - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- London Commodity Brokers - England
- Rashtriya Ispat Nigam Limited - India
- Georgia Ports Authority, United States
- Uttam Galva Steels Limited - India
- Vedanta Resources Plc - India
- Alfred C Toepfer International GmbH - Germany
- Kumho Petrochemical, South Korea
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Malabar Cements Ltd - India
- Iligan Light & Power Inc, Philippines
- Ministry of Mines - Canada
- Indonesian Coal Mining Association
- San Jose City I Power Corp, Philippines
- Mercuria Energy - Indonesia
- Bhatia International Limited - India
- Thai Mozambique Logistica
- Global Green Power PLC Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Siam City Cement PLC, Thailand
- Kepco SPC Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- GMR Energy Limited - India
- Latin American Coal - Colombia
- Jaiprakash Power Ventures ltd
- Deloitte Consulting - India
- Minerals Council of Australia
- Lanco Infratech Ltd - India
- Xindia Steels Limited - India
- Sree Jayajothi Cements Limited - India
- Straits Asia Resources Limited - Singapore
- Meralco Power Generation, Philippines
- Madhucon Powers Ltd - India
- Commonwealth Bank - Australia
- Star Paper Mills Limited - India
- Sindya Power Generating Company Private Ltd
- Ceylon Electricity Board - Sri Lanka
- LBH Netherlands Bv - Netherlands
- MS Steel International - UAE
- Pipit Mutiara Jaya. PT, Indonesia
- Cement Manufacturers Association - India
- Larsen & Toubro Limited - India
- Merrill Lynch Commodities Europe
- Barasentosa Lestari - Indonesia
- Eastern Energy - Thailand
- Power Finance Corporation Ltd., India
- PTC India Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Heidelberg Cement - Germany
- Simpson Spence & Young - Indonesia
- Central Electricity Authority - India
- Posco Energy - South Korea
- Manunggal Multi Energi - Indonesia
- Agrawal Coal Company - India
- Dalmia Cement Bharat India
- Indika Energy - Indonesia
- Petron Corporation, Philippines
- Karaikal Port Pvt Ltd - India
- Medco Energi Mining Internasional
- Vijayanagar Sugar Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Sarangani Energy Corporation, Philippines
- Parry Sugars Refinery, India
- Sakthi Sugars Limited - India
- Attock Cement Pakistan Limited
- Bukit Asam (Persero) Tbk - Indonesia
- Mjunction Services Limited - India
- Edison Trading Spa - Italy
- Electricity Authority, New Zealand
- Therma Luzon, Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Gujarat Sidhee Cement - India
- IHS Mccloskey Coal Group - USA
- Ind-Barath Power Infra Limited - India
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