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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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Wednesday, 16 December 20
INDONESIAN COAL RECOVERING - FITCH
Commenting on Indonesian coal, Fitch Ratings, the Indonesian 4,200 kcal index has begun to recover, improving to over USD 29 in November compared t ...
Tuesday, 15 December 20
NEWCASTLE PRICES RECOVER - FITCH
Prices for the benchmark Newcastle 6,000 kcal/kg grade coal have rebounded to over USD 70/tonne since late November as major Asian economies ease l ...
Tuesday, 15 December 20
APAC COAL PRICES REBOUND ON IMPROVED DEMAND AND SUPPLY CUTS - FITCH RATINGS
Prices for the benchmark Newcastle 6,000kcal/kg grade coal have rebounded to over USD70/tonne since late November as major Asian economies ease loc ...
Tuesday, 15 December 20
CHINA EXTENDS FULL OPEN GESTURE TO IMPORTED COAL EXCEPT FOR AUSTRALIA - GLOBAL TIMES
Domestic, overseas suppliers will take up share with easier clearance
China's top economic planner on Saturday gave approval to ...
Monday, 14 December 20
PHILIPPINE BANK RCBC TO STOP LENDING FOR NEW COAL-FIRED POWER PROJECTS - MANILA BULLETIN
Yuchengco-led Rizal Commercial Banking Corporation (RCBC) has forthrightly declared that it will no longer extend financing to new coal-fired power ...
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Showing 706 to 710 news of total 6871 |
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- Vijayanagar Sugar Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Semirara Mining Corp, Philippines
- SMG Consultants - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Indian Oil Corporation Limited
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Rashtriya Ispat Nigam Limited - India
- Australian Coal Association
- Parry Sugars Refinery, India
- Savvy Resources Ltd - HongKong
- Sojitz Corporation - Japan
- Romanian Commodities Exchange
- Iligan Light & Power Inc, Philippines
- Essar Steel Hazira Ltd - India
- The University of Queensland
- PowerSource Philippines DevCo
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Timah Investasi Mineral - Indoneisa
- LBH Netherlands Bv - Netherlands
- IEA Clean Coal Centre - UK
- Posco Energy - South Korea
- TNB Fuel Sdn Bhd - Malaysia
- Indonesian Coal Mining Association
- Meenaskhi Energy Private Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Port Waratah Coal Services - Australia
- Bangladesh Power Developement Board
- Ministry of Mines - Canada
- Aditya Birla Group - India
- Thiess Contractors Indonesia
- Star Paper Mills Limited - India
- Attock Cement Pakistan Limited
- Indogreen Group - Indonesia
- Latin American Coal - Colombia
- Lanco Infratech Ltd - India
- Kartika Selabumi Mining - Indonesia
- Global Business Power Corporation, Philippines
- Merrill Lynch Commodities Europe
- Edison Trading Spa - Italy
- Mjunction Services Limited - India
- GMR Energy Limited - India
- Bhoruka Overseas - Indonesia
- Aboitiz Power Corporation - Philippines
- Energy Link Ltd, New Zealand
- Jaiprakash Power Ventures ltd
- Deloitte Consulting - India
- Holcim Trading Pte Ltd - Singapore
- Baramulti Group, Indonesia
- Salva Resources Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Kumho Petrochemical, South Korea
- Chamber of Mines of South Africa
- Intertek Mineral Services - Indonesia
- Commonwealth Bank - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- MS Steel International - UAE
- Renaissance Capital - South Africa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Altura Mining Limited, Indonesia
- Medco Energi Mining Internasional
- Kobexindo Tractors - Indoneisa
- Wood Mackenzie - Singapore
- Siam City Cement PLC, Thailand
- Standard Chartered Bank - UAE
- Formosa Plastics Group - Taiwan
- AsiaOL BioFuels Corp., Philippines
- Bukit Baiduri Energy - Indonesia
- Central Electricity Authority - India
- Ambuja Cements Ltd - India
- The Treasury - Australian Government
- Semirara Mining and Power Corporation, Philippines
- Tata Chemicals Ltd - India
- Agrawal Coal Company - India
- Miang Besar Coal Terminal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- SMC Global Power, Philippines
- Ministry of Finance - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- PNOC Exploration Corporation - Philippines
- Economic Council, Georgia
- GN Power Mariveles Coal Plant, Philippines
- Marubeni Corporation - India
- Therma Luzon, Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Simpson Spence & Young - Indonesia
- Electricity Authority, New Zealand
- Bhatia International Limited - India
- Manunggal Multi Energi - Indonesia
- Xindia Steels Limited - India
- Eastern Coal Council - USA
- Jindal Steel & Power Ltd - India
- Metalloyd Limited - United Kingdom
- Vizag Seaport Private Limited - India
- Dalmia Cement Bharat India
- Indo Tambangraya Megah - Indonesia
- McConnell Dowell - Australia
- TeaM Sual Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Borneo Indobara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Gujarat Electricity Regulatory Commission - India
- Kepco SPC Power Corporation, Philippines
- India Bulls Power Limited - India
- Anglo American - United Kingdom
- Mintek Dendrill Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Pendopo Energi Batubara - Indonesia
- Bukit Makmur.PT - Indonesia
- Mercator Lines Limited - India
- VISA Power Limited - India
- Maheswari Brothers Coal Limited - India
- Coalindo Energy - Indonesia
- Indian Energy Exchange, India
- Wilmar Investment Holdings
- Sindya Power Generating Company Private Ltd
- GVK Power & Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- Orica Australia Pty. Ltd.
- Samtan Co., Ltd - South Korea
- Alfred C Toepfer International GmbH - Germany
- Mercuria Energy - Indonesia
- Larsen & Toubro Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Riau Bara Harum - Indonesia
- Bharathi Cement Corporation - India
- Sakthi Sugars Limited - India
- Antam Resourcindo - Indonesia
- Bayan Resources Tbk. - Indonesia
- Cement Manufacturers Association - India
- Sical Logistics Limited - India
- Parliament of New Zealand
- Directorate Of Revenue Intelligence - India
- OPG Power Generation Pvt Ltd - India
- Malabar Cements Ltd - India
- Indika Energy - Indonesia
- Georgia Ports Authority, United States
- International Coal Ventures Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Cigading International Bulk Terminal - Indonesia
- Price Waterhouse Coopers - Russia
- New Zealand Coal & Carbon
- Krishnapatnam Port Company Ltd. - India
- White Energy Company Limited
- Eastern Energy - Thailand
- Heidelberg Cement - Germany
- Coastal Gujarat Power Limited - India
- European Bulk Services B.V. - Netherlands
- Grasim Industreis Ltd - India
- Karaikal Port Pvt Ltd - India
- Uttam Galva Steels Limited - India
- CNBM International Corporation - China
- London Commodity Brokers - England
- Tamil Nadu electricity Board
- IHS Mccloskey Coal Group - USA
- Sarangani Energy Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Billiton Holdings Pty Ltd - Australia
- Bulk Trading Sa - Switzerland
- Singapore Mercantile Exchange
- Global Coal Blending Company Limited - Australia
- Africa Commodities Group - South Africa
- Electricity Generating Authority of Thailand
- Madhucon Powers Ltd - India
- PTC India Limited - India
- Gujarat Sidhee Cement - India
- ASAPP Information Group - India
- Australian Commodity Traders Exchange
- Chettinad Cement Corporation Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Minerals Council of Australia
- Carbofer General Trading SA - India
- ICICI Bank Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Barasentosa Lestari - Indonesia
- Makarim & Taira - Indonesia
- San Jose City I Power Corp, Philippines
- Sree Jayajothi Cements Limited - India
- Banpu Public Company Limited - Thailand
- Vedanta Resources Plc - India
- Coal and Oil Company - UAE
- Thai Mozambique Logistica
- CIMB Investment Bank - Malaysia
- Bhushan Steel Limited - India
- SN Aboitiz Power Inc, Philippines
- Petron Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Power Finance Corporation Ltd., India
- Kapuas Tunggal Persada - Indonesia
- Oldendorff Carriers - Singapore
- Kaltim Prima Coal - Indonesia
- Orica Mining Services - Indonesia
- Kideco Jaya Agung - Indonesia
- Siam City Cement - Thailand
- South Luzon Thermal Energy Corporation
- The State Trading Corporation of India Ltd
- Central Java Power - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Rio Tinto Coal - Australia
- Ministry of Transport, Egypt
- Jorong Barutama Greston.PT - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Straits Asia Resources Limited - Singapore
- Trasteel International SA, Italy
- Ind-Barath Power Infra Limited - India
- Meralco Power Generation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Globalindo Alam Lestari - Indonesia
- Independent Power Producers Association of India
- Planning Commission, India
- Toyota Tsusho Corporation, Japan
- Asmin Koalindo Tuhup - Indonesia
- Videocon Industries ltd - India
- Interocean Group of Companies - India
- Binh Thuan Hamico - Vietnam
- Energy Development Corp, Philippines
- Goldman Sachs - Singapore
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