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Saturday, 31 October 09
PRODUCERS BENEFIT FROM COAL'S TIGHT SUPPLY AND STRONG DEMAND
 The Jakarta Post reported that, The outlook for Indonesian coal producers appears promising with strong volume growth coming from both the domestic and export markets.
Despite the delayed completion of the 10,000 megawatts (MW) coal-fired steam power plant (PLTU) program, we expect to see additional electricity capacity starting in the fourth quarter of 2009. PLTU Labuan (2x300 MW) was scheduled to operate its first unit in September 2009 and the second unit by December 2009.
PLTU Rembang (2x315 MW) and Indramayu (2x330 MW) should start to operate by January 2010. As nine out of 10 projects in Java-Bali are now in their construction stages, there should be a total add-on capacity of 6,830 MW by the end of 2010. Six PLTU projects (total capacity162 MW) outside the Java-Bali region have already started the construction stage in the fourth quarter of this year with an additional 5 to follow suit.
The Government of Indonesia has finally approved the coal volume required for the domestic market obligation (DMO) at 75 million tons per year starting from 2010, 10.3 percent higher year-on-year from 68 million tons of domestic consumption estimated for 2009.
The volume set for the DMO would amount to 30 percent of the 2010 total estimate for coal production at 250 million tons or up 8.7 percent year-on-year from the 2009 estimate of 230 million tons (chart 1). PLN itself has signed 20-year coal supply contracts, effective once the PLTUs are operational, amounting to 30m tons per year of low-rank coal.
We foresee that the implementation of the DMO has limited the flexibility for coal producers to aggressively penetrate the export market. On top of that, the government has recently revealed its intention to apply a restriction on export quotas at 150 million tons per year starting from 2010.
The regulations would also require each coal producer to allocate 25 percent of their total coal production for the domestic market, or to face penalties in the form of restrictions on their exports.
We see, however, that this last regulation might not be necessary due to the anticipated increase in the volume of coal production going forward, exceeding the domestic demand requirements.
On a more positive note, the government seems willing to accommodate Indonesian coal producers' wishes for minor interventions in regulating the sales price for coal under the DMO provisions. The sales price will be with reference to the international market price to avoid high spreads between export and domestic pricing.
Based on the Newcastle Index, the year-to-date coal price has averaged US$70.7 per ton. Despite a downward trend since the fourth quarter of 2008, coal prices have been relatively steady throughout 2009.
We believe that the price of coal has found its new equilibrium at current levels, supported by stronger demand for higher energy needs mostly in the South East Asian region. Hence, we now expect the coal price to average US$75/t in 2010.
Government also plans to cut the royalty tax rate (DPHB) on low calorific value coal. The proposed DPHB rate is 9 percent for coal with CV<5,000kcal/kg (vis-*-vis 13.5 percent previously) and 7.5 percent for CV<4,500kcal/kg.
We see that upon implementation, lower royalty rates will mean incentives towards growth expectations in the sector.
Stronger domestic demand starting from 2010 paired with recovery of global demand will provide higher volume support for demand for both thermal and coking coal. In our view India will provide the highest growth in thermal coal demand, boosting imports by about 18% to 40m tons beginning this year, in line with the government's plan to double coal-fired electricity generation capacity by 2017.
Indonesia has also made preparations to start the 10,000 MW program phase II which is scheduled to start in 2012 and to operate by 2014.
We estimate coal-fired power plants will take around 48 percent from the total portion of 9,963 MW. Furthermore, coal supply may not grow at the same pace as demand due to export restrictions set on major coal exporters, such as Vietnam and China to secure their domestic needs.
Supported by the fact that the China government has decided to reduce its export quota by 50 percent from 40 million tons to 20 million tons.
As one of the world's major coal exporters, Indonesia will certainly have the upper hand in the tightening supply of coal.
Source:The Jakarta Post
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Tuesday, 20 October 09
COAL PRICES TO SURGE IN 2010 DESPITE AMPLE SUPPLY
Commodity Online reported that, Coal prices are indeed destined to go higher as they follow the rise of ‘coal currencies’ such as Austra ...
Tuesday, 20 October 09
INDIA MAY CUT STAKE IN NTPC BY DECEMBER, POWER SECRETARY SAYS
Bloomberg reported that, India’s government may sell a 5 percent stake in NTPC Ltd., the country’s biggest power producer, as early as D ...
Monday, 19 October 09
COAL PRICE UP AGAIN - RICHARDS BAY TERMINAL
Export prices rose 45 cents, or 0.7%, to an average of 64.05 a metric ton in the week ended Oct. 16, according to McCloskey Group.
The week was & ...
Monday, 19 October 09
COAL MINISTRY SEEKS EXPLANATION FROM AP GENCO
The Hindu Business reported that, the Coal Ministry has asked the Power Generation Corporation of Andhra Pradesh (AP Genco) to explain why there was ...
Monday, 19 October 09
CEMENT UNLIKELY TO COST MORE DESPITE COAL PRICE HIKE
Business-Standard reported that, Cement manufacturers will not immediately hike prices of the construction material, despite a surge in their input ...
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- Sindya Power Generating Company Private Ltd
- Ind-Barath Power Infra Limited - India
- Economic Council, Georgia
- Sree Jayajothi Cements Limited - India
- Sinarmas Energy and Mining - Indonesia
- Banpu Public Company Limited - Thailand
- AsiaOL BioFuels Corp., Philippines
- Gujarat Electricity Regulatory Commission - India
- Oldendorff Carriers - Singapore
- Cement Manufacturers Association - India
- Baramulti Group, Indonesia
- Petron Corporation, Philippines
- SMG Consultants - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Eastern Energy - Thailand
- Commonwealth Bank - Australia
- Directorate General of MIneral and Coal - Indonesia
- Mercator Lines Limited - India
- Kumho Petrochemical, South Korea
- Australian Coal Association
- Miang Besar Coal Terminal - Indonesia
- Altura Mining Limited, Indonesia
- Therma Luzon, Inc, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Barasentosa Lestari - Indonesia
- Pendopo Energi Batubara - Indonesia
- Semirara Mining Corp, Philippines
- Sakthi Sugars Limited - India
- Coal and Oil Company - UAE
- Price Waterhouse Coopers - Russia
- Aditya Birla Group - India
- Global Green Power PLC Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- The Treasury - Australian Government
- Deloitte Consulting - India
- Borneo Indobara - Indonesia
- Australian Commodity Traders Exchange
- Kobexindo Tractors - Indoneisa
- Ministry of Transport, Egypt
- Ministry of Finance - Indonesia
- Kepco SPC Power Corporation, Philippines
- Global Coal Blending Company Limited - Australia
- Neyveli Lignite Corporation Ltd, - India
- Bukit Makmur.PT - Indonesia
- Standard Chartered Bank - UAE
- Eastern Coal Council - USA
- Medco Energi Mining Internasional
- Karbindo Abesyapradhi - Indoneisa
- GMR Energy Limited - India
- Rio Tinto Coal - Australia
- Gujarat Sidhee Cement - India
- Tamil Nadu electricity Board
- Trasteel International SA, Italy
- The University of Queensland
- Ceylon Electricity Board - Sri Lanka
- Binh Thuan Hamico - Vietnam
- Alfred C Toepfer International GmbH - Germany
- London Commodity Brokers - England
- Power Finance Corporation Ltd., India
- Bahari Cakrawala Sebuku - Indonesia
- Indika Energy - Indonesia
- Karaikal Port Pvt Ltd - India
- Latin American Coal - Colombia
- Heidelberg Cement - Germany
- Bukit Baiduri Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- Energy Development Corp, Philippines
- Savvy Resources Ltd - HongKong
- Dalmia Cement Bharat India
- Indian Oil Corporation Limited
- Vedanta Resources Plc - India
- Globalindo Alam Lestari - Indonesia
- GVK Power & Infra Limited - India
- Central Java Power - Indonesia
- MS Steel International - UAE
- India Bulls Power Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Kartika Selabumi Mining - Indonesia
- Malabar Cements Ltd - India
- CNBM International Corporation - China
- Asmin Koalindo Tuhup - Indonesia
- White Energy Company Limited
- Electricity Authority, New Zealand
- Goldman Sachs - Singapore
- Siam City Cement PLC, Thailand
- International Coal Ventures Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- Grasim Industreis Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Marubeni Corporation - India
- GN Power Mariveles Coal Plant, Philippines
- Orica Australia Pty. Ltd.
- Carbofer General Trading SA - India
- Chamber of Mines of South Africa
- VISA Power Limited - India
- Simpson Spence & Young - Indonesia
- Bulk Trading Sa - Switzerland
- Madhucon Powers Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- San Jose City I Power Corp, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Edison Trading Spa - Italy
- OPG Power Generation Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Energy Link Ltd, New Zealand
- Bayan Resources Tbk. - Indonesia
- IHS Mccloskey Coal Group - USA
- Leighton Contractors Pty Ltd - Australia
- Agrawal Coal Company - India
- Essar Steel Hazira Ltd - India
- Merrill Lynch Commodities Europe
- Mercuria Energy - Indonesia
- Thiess Contractors Indonesia
- TeaM Sual Corporation - Philippines
- Electricity Generating Authority of Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Metalloyd Limited - United Kingdom
- Parry Sugars Refinery, India
- Salva Resources Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Africa Commodities Group - South Africa
- IEA Clean Coal Centre - UK
- Directorate Of Revenue Intelligence - India
- Vijayanagar Sugar Pvt Ltd - India
- Thai Mozambique Logistica
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Makarim & Taira - Indonesia
- Georgia Ports Authority, United States
- Bhushan Steel Limited - India
- Vizag Seaport Private Limited - India
- Indian Energy Exchange, India
- The State Trading Corporation of India Ltd
- Kaltim Prima Coal - Indonesia
- Jindal Steel & Power Ltd - India
- Coastal Gujarat Power Limited - India
- GAC Shipping (India) Pvt Ltd
- Manunggal Multi Energi - Indonesia
- Star Paper Mills Limited - India
- Tata Chemicals Ltd - India
- Parliament of New Zealand
- PetroVietnam Power Coal Import and Supply Company
- Renaissance Capital - South Africa
- Krishnapatnam Port Company Ltd. - India
- Cigading International Bulk Terminal - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Billiton Holdings Pty Ltd - Australia
- Singapore Mercantile Exchange
- Meralco Power Generation, Philippines
- Bangladesh Power Developement Board
- Mjunction Services Limited - India
- Lanco Infratech Ltd - India
- New Zealand Coal & Carbon
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Xindia Steels Limited - India
- Bhatia International Limited - India
- Formosa Plastics Group - Taiwan
- Sical Logistics Limited - India
- Kohat Cement Company Ltd. - Pakistan
- LBH Netherlands Bv - Netherlands
- PNOC Exploration Corporation - Philippines
- Siam City Cement - Thailand
- Larsen & Toubro Limited - India
- Ministry of Mines - Canada
- Jaiprakash Power Ventures ltd
- Orica Mining Services - Indonesia
- Indogreen Group - Indonesia
- Minerals Council of Australia
- CIMB Investment Bank - Malaysia
- Wilmar Investment Holdings
- SMC Global Power, Philippines
- South Luzon Thermal Energy Corporation
- Global Business Power Corporation, Philippines
- Anglo American - United Kingdom
- Coalindo Energy - Indonesia
- Wood Mackenzie - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Romanian Commodities Exchange
- Timah Investasi Mineral - Indoneisa
- Interocean Group of Companies - India
- Iligan Light & Power Inc, Philippines
- Central Electricity Authority - India
- Jorong Barutama Greston.PT - Indonesia
- Samtan Co., Ltd - South Korea
- ICICI Bank Limited - India
- Indonesian Coal Mining Association
- Riau Bara Harum - Indonesia
- PowerSource Philippines DevCo
- Sojitz Corporation - Japan
- Attock Cement Pakistan Limited
- Indo Tambangraya Megah - Indonesia
- Port Waratah Coal Services - Australia
- Maheswari Brothers Coal Limited - India
- Sarangani Energy Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Ambuja Cements Ltd - India
- Videocon Industries ltd - India
- SN Aboitiz Power Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Mintek Dendrill Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Antam Resourcindo - Indonesia
- Bharathi Cement Corporation - India
- Posco Energy - South Korea
- Kideco Jaya Agung - Indonesia
- Independent Power Producers Association of India
- McConnell Dowell - Australia
- Planning Commission, India
- Intertek Mineral Services - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Uttam Galva Steels Limited - India
- Toyota Tsusho Corporation, Japan
- Bhoruka Overseas - Indonesia
- ASAPP Information Group - India
- PTC India Limited - India
- Holcim Trading Pte Ltd - Singapore
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