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Thursday, 17 December 20
CHINA'S BAN IS LESS OF A THREAT TO AUSTRALIA'S COAL INDUSTRY THAN INTERNATIONAL CLIMATE AMBITION - IEEFA
 Australian coal exporters will survive this near-term political fight but there are longterm structural headwinds
The decision by China’s National Development and Reform Commission to formally and indefinitely block Australian coal imports is a key threat to Australia’s political and economic wellbeing. Australia can never expect to win a trade war with its biggest export partner, and it is sheer political and economic suicide to try to do so. But is it devastating for the Australian coal export industry? Not at all.
Far more strategically threatening in the long term for Australia and our coal industry is the pledge by China’s president Xi Jinping to reach net zero emissions by 2060, which was rapidly followed by net zero emissions by 2050 pledges from Japan’s prime minister Yoshihide Suga and South Korea’s president Moon Jae-in. This series of sudden and powerful pledges of increased climate ambition by world leaders is likely to be terminal for our coal exports if we look out a couple of decades.
Australia is caught in the geopolitical quandary of having China as our key trade partner and the United States as our key military ally. When US president Donald Trump started a trade war with China, it was never going to turn out well for Australia. And incoming president Joe Biden is unlikely to change tack too materially where China and trade and technology are concerned (whereas on climate, Biden’s arrival changes everything). But we in Australia are like a mouse caught in the middle of two sparring elephants.
In business, the best rule is that the customer is always right (even if they are not). Our coal exporters will however survive this near-term political fight, probably far better than our wine or lobster export industries, by comparison.
There are no coal ships destined for China being loaded in Australia now. For most industries, that would be devastating. For coal, not so much. In fact, a look at the share prices of Whitehaven Coal and New Hope Corporation would suggest quite the opposite. Since the September 2020 trough, and acknowledging the sharp price falls on Tuesday, Whitehaven shares have rallied 70% and New Hope are up almost 20%.
Why? Coal is coal, at least to a finance analyst like me, if not an engineer. Australia sells the vast majority of its coal to Japan, South Korea and Taiwan. And if China buys more Russian, South African and Indonesian coal to replace Australian coal, then we can, by and large, simply swap customers, maybe with a month’s disruption. Total demand doesn’t change, nor does supply – at least not in the near term. Sure, there are some boiler and blending constraints, but notwithstanding coal luddite claims that Australia’s coal is slightly less carbon polluting than someone else’s seaborne coal, the minute difference is irrelevant – all coal is almost 100% more carbon intensive than wind, solar, hydro, nuclear or energy efficiency. Or green ammonia, as Japan’s JERA is now thinking.
The coal industry is actually benefiting from a near-term relief rally. In September Australian coal exporters were losing money with every tonne of coal they exported. In December, the picture is very different. China’s key Shanxi province has just shut down coal production near term due to a spate of deadly accidents, just as winter heating demand has kicked in. Meanwhile the Chinese industrial economy is powering along. So the Chinese domestic thermal coal price has jumped 35% to 740/t yuan in the last three months. Seaborne thermal coal prices have rallied from a low of US$46/t to over US$70/t in the same timeframe. Even as total volume of Australian coal exports have dropped in the December quarter, the value has surged, and more importantly, the profitability much more so (notwithstanding the 10% rally in the Aus$/US$, lifted by the unprecedented rally in iron ore prices). Hence the Whitehaven Coal and New Hope increase in share price.
The coal export sector outlook seems profitable again – in the near term. But the 25% collapse in the Dalrymple Bay Coal Terminal share price since its initial public offering last week is a clearer perspective of the longterm structural headwinds Australia’s coal industry is facing. Far better for our Hunter Valley, La Trobe Valley and Bowen Basin communities that we as a nation acknowledge the science of climate change, prepare a national roadmap, ideally with a destination and time of arrival clearly acknowledged.
The investment, employment and export opportunities for Australia are enormous, and exciting. To steal a very good line from Ross Garnaut and Mike Cannon-Brookes – better we focus on building Australia as a renewable energy superpower.
This commentary first appeared in The Guardian.
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Tuesday, 22 December 20
INDIA'S COAL DEMAND IS SET TO EXPAND DESPITE PLUMMETING IN 2020 - IEA
Coal consumption in India amounted to 979 Mt in 2019, with the largest share being thermal coal (including lignite) for electricity generation (687 ...
Tuesday, 22 December 20
SOUTHEAST ASIA'S COAL DEMAND IS SET TO EXPAND AFTER THE PANDEMIC-INDUCED HIATUS IN 2020 - IEA
Coal consumption in Southeast Asia has more than doubled in the last decade, with the largest growth in Indonesia and Viet Nam, followed by Malaysi ...
Tuesday, 22 December 20
COAL DEMAND IS RISING QUICKLY IN PAKISTAN AND MORE SLOWLY IN BANGLADESH - IEA
Pakistan had 150 MW of installed coal power capacity in 2015. Since 2017, in addition to a few small plants for industry, Pakistan has commissioned ...
Tuesday, 22 December 20
AFRICA PERSPECTIVE INDICATES NO MAJOR SHIFTS FOR COAL CONSUMPTION - IEA
Overall countries on the African continent consumed 197 Mt of coal in 2019, 12 Mt less (-6%) than 2018.
South Africa, the continent& ...
Monday, 21 December 20
COAL PRICES WITHSTAND DESPITE COVID-19 AND CHINESE IMPORT QUOTAS - IEA
Coal prices vary by region as well as by grade and quality. The price rebound starting in 2016 ended in 2018, moving in a downward trend in 2019. A ...
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- Sical Logistics Limited - India
- Uttam Galva Steels Limited - India
- TeaM Sual Corporation - Philippines
- White Energy Company Limited
- Therma Luzon, Inc, Philippines
- Electricity Generating Authority of Thailand
- Romanian Commodities Exchange
- Aditya Birla Group - India
- Bhushan Steel Limited - India
- Planning Commission, India
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- Orica Mining Services - Indonesia
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- Coal and Oil Company - UAE
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- Economic Council, Georgia
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- Kohat Cement Company Ltd. - Pakistan
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- Parliament of New Zealand
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- Mercator Lines Limited - India
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- Indian Energy Exchange, India
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- Intertek Mineral Services - Indonesia
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- Simpson Spence & Young - Indonesia
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- Africa Commodities Group - South Africa
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- Cement Manufacturers Association - India
- San Jose City I Power Corp, Philippines
- Kapuas Tunggal Persada - Indonesia
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- Oldendorff Carriers - Singapore
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- Indian Oil Corporation Limited
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- Jaiprakash Power Ventures ltd
- Bharathi Cement Corporation - India
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- Madhucon Powers Ltd - India
- Global Coal Blending Company Limited - Australia
- Dalmia Cement Bharat India
- Ind-Barath Power Infra Limited - India
- Electricity Authority, New Zealand
- Energy Development Corp, Philippines
- Indika Energy - Indonesia
- Global Business Power Corporation, Philippines
- Parry Sugars Refinery, India
- Edison Trading Spa - Italy
- Billiton Holdings Pty Ltd - Australia
- Malabar Cements Ltd - India
- Bhatia International Limited - India
- Latin American Coal - Colombia
- Trasteel International SA, Italy
- Independent Power Producers Association of India
- India Bulls Power Limited - India
- Maheswari Brothers Coal Limited - India
- Cigading International Bulk Terminal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Coastal Gujarat Power Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sojitz Corporation - Japan
- Holcim Trading Pte Ltd - Singapore
- Mjunction Services Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Savvy Resources Ltd - HongKong
- Gujarat Electricity Regulatory Commission - India
- Vijayanagar Sugar Pvt Ltd - India
- Interocean Group of Companies - India
- Banpu Public Company Limited - Thailand
- Aboitiz Power Corporation - Philippines
- Vedanta Resources Plc - India
- Globalindo Alam Lestari - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Price Waterhouse Coopers - Russia
- Georgia Ports Authority, United States
- Tata Chemicals Ltd - India
- The University of Queensland
- Coalindo Energy - Indonesia
- Heidelberg Cement - Germany
- GMR Energy Limited - India
- Sindya Power Generating Company Private Ltd
- Sakthi Sugars Limited - India
- Altura Mining Limited, Indonesia
- Thiess Contractors Indonesia
- Leighton Contractors Pty Ltd - Australia
- Kumho Petrochemical, South Korea
- PNOC Exploration Corporation - Philippines
- SMC Global Power, Philippines
- Sree Jayajothi Cements Limited - India
- AsiaOL BioFuels Corp., Philippines
- Toyota Tsusho Corporation, Japan
- The Treasury - Australian Government
- Larsen & Toubro Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
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- Kaltim Prima Coal - Indonesia
- PTC India Limited - India
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- Bulk Trading Sa - Switzerland
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- Directorate Of Revenue Intelligence - India
- Binh Thuan Hamico - Vietnam
- Ministry of Transport, Egypt
- Iligan Light & Power Inc, Philippines
- Singapore Mercantile Exchange
- Port Waratah Coal Services - Australia
- Bayan Resources Tbk. - Indonesia
- Orica Australia Pty. Ltd.
- International Coal Ventures Pvt Ltd - India
- New Zealand Coal & Carbon
- Chettinad Cement Corporation Ltd - India
- GAC Shipping (India) Pvt Ltd
- Standard Chartered Bank - UAE
- Siam City Cement - Thailand
- Bangladesh Power Developement Board
- OPG Power Generation Pvt Ltd - India
- Thai Mozambique Logistica
- Semirara Mining and Power Corporation, Philippines
- IEA Clean Coal Centre - UK
- Meralco Power Generation, Philippines
- McConnell Dowell - Australia
- Rio Tinto Coal - Australia
- Eastern Coal Council - USA
- Agrawal Coal Company - India
- Jorong Barutama Greston.PT - Indonesia
- IHS Mccloskey Coal Group - USA
- Bahari Cakrawala Sebuku - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Central Java Power - Indonesia
- Medco Energi Mining Internasional
- VISA Power Limited - India
- Anglo American - United Kingdom
- Indogreen Group - Indonesia
- Salva Resources Pvt Ltd - India
- Semirara Mining Corp, Philippines
- SMG Consultants - Indonesia
- Jindal Steel & Power Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Essar Steel Hazira Ltd - India
- Ministry of Finance - Indonesia
- Bhoruka Overseas - Indonesia
- London Commodity Brokers - England
- Borneo Indobara - Indonesia
- Lanco Infratech Ltd - India
- Samtan Co., Ltd - South Korea
- Straits Asia Resources Limited - Singapore
- Goldman Sachs - Singapore
- Commonwealth Bank - Australia
- Tamil Nadu electricity Board
- Pipit Mutiara Jaya. PT, Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Wood Mackenzie - Singapore
- Ministry of Mines - Canada
- Kideco Jaya Agung - Indonesia
- Metalloyd Limited - United Kingdom
- PowerSource Philippines DevCo
- Global Green Power PLC Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Minerals Council of Australia
- Alfred C Toepfer International GmbH - Germany
- Eastern Energy - Thailand
- SN Aboitiz Power Inc, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Formosa Plastics Group - Taiwan
- Xindia Steels Limited - India
- ICICI Bank Limited - India
- Bukit Baiduri Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- South Luzon Thermal Energy Corporation
- CIMB Investment Bank - Malaysia
- Australian Coal Association
- Riau Bara Harum - Indonesia
- Grasim Industreis Ltd - India
- Star Paper Mills Limited - India
- CNBM International Corporation - China
- Merrill Lynch Commodities Europe
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- MS Steel International - UAE
- Petron Corporation, Philippines
- Indonesian Coal Mining Association
- Ambuja Cements Ltd - India
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- Miang Besar Coal Terminal - Indonesia
- Power Finance Corporation Ltd., India
- Posco Energy - South Korea
- Renaissance Capital - South Africa
- Kepco SPC Power Corporation, Philippines
- Barasentosa Lestari - Indonesia
- ASAPP Information Group - India
- Bukit Asam (Persero) Tbk - Indonesia
- Asmin Koalindo Tuhup - Indonesia
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