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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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Saturday, 05 September 20
INDIA WON'T KICK ITS COAL HABIT SO EASILY - HINDU BUSINESS LINE
India has traditionally considered itself lucky to have been endowed with abundant coal reserves, which it has sought to use to meet its energy nee ...
Saturday, 05 September 20
FINANCING COMPLETE FOR 900MW FIFTH PHASE OF MASSIVE DUBAI SOLAR PARK: ARABIAN BUSINESS
Saudi-based ACWA Power on Thursday announced it has completed the signing of all financing agreements for the fifth phase of the Mohammed bin Rashi ...
Saturday, 05 September 20
POLISH COAL DEMAND EXPECTED TO FALL BY 7 MLN TONNES NEXT YEAR: MINISTER - REUTERS
Poland’s demand for coal is expected to fall by around 7 million tonnes next year, or more than 10% of annual hard coal production, after a d ...
Saturday, 05 September 20
PAKISTAN'S NEW 27-YEAR POWER PLAN RISKS LOCKING IN LONG-TERM OVERCAPACITY, LEAVING IMPORTED COAL AND LNG PLANTS STRANDED - IEEFA
Wind and solar, the country’s cheapest source of new generation, also overlooked
Pakistan risks locking itself into building m ...
Friday, 04 September 20
IN A DEEPENING DEBT HOLE OF $34 BILLION, INDONESIA’S PLN MUST STOP DIGGING - IEEFA
The utility has added IDR100 trillion in debt annually for the last five years
Utilities globally started changing the way they do business ye ...
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Showing 791 to 795 news of total 6871 |
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- AsiaOL BioFuels Corp., Philippines
- Interocean Group of Companies - India
- Kaltim Prima Coal - Indonesia
- Toyota Tsusho Corporation, Japan
- Indo Tambangraya Megah - Indonesia
- Bukit Makmur.PT - Indonesia
- Karaikal Port Pvt Ltd - India
- Ministry of Finance - Indonesia
- Minerals Council of Australia
- TNB Fuel Sdn Bhd - Malaysia
- Sical Logistics Limited - India
- Thai Mozambique Logistica
- Latin American Coal - Colombia
- Marubeni Corporation - India
- Therma Luzon, Inc, Philippines
- Orica Australia Pty. Ltd.
- Bhoruka Overseas - Indonesia
- Kepco SPC Power Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Sree Jayajothi Cements Limited - India
- Vedanta Resources Plc - India
- Binh Thuan Hamico - Vietnam
- The Treasury - Australian Government
- Uttam Galva Steels Limited - India
- Coal and Oil Company - UAE
- Electricity Generating Authority of Thailand
- Bukit Baiduri Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Standard Chartered Bank - UAE
- Indian Oil Corporation Limited
- Global Green Power PLC Corporation, Philippines
- GMR Energy Limited - India
- Metalloyd Limited - United Kingdom
- Coalindo Energy - Indonesia
- SMG Consultants - Indonesia
- Sindya Power Generating Company Private Ltd
- IHS Mccloskey Coal Group - USA
- Videocon Industries ltd - India
- Kobexindo Tractors - Indoneisa
- Borneo Indobara - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Agrawal Coal Company - India
- Australian Coal Association
- Sarangani Energy Corporation, Philippines
- Meralco Power Generation, Philippines
- Directorate Of Revenue Intelligence - India
- Banpu Public Company Limited - Thailand
- CNBM International Corporation - China
- Parry Sugars Refinery, India
- Savvy Resources Ltd - HongKong
- Kapuas Tunggal Persada - Indonesia
- Energy Link Ltd, New Zealand
- Rio Tinto Coal - Australia
- South Luzon Thermal Energy Corporation
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Madhucon Powers Ltd - India
- Rashtriya Ispat Nigam Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Eastern Coal Council - USA
- Australian Commodity Traders Exchange
- Simpson Spence & Young - Indonesia
- Mintek Dendrill Indonesia
- Bhatia International Limited - India
- Globalindo Alam Lestari - Indonesia
- Makarim & Taira - Indonesia
- Tata Chemicals Ltd - India
- Indian Energy Exchange, India
- London Commodity Brokers - England
- Kalimantan Lumbung Energi - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Mercuria Energy - Indonesia
- Parliament of New Zealand
- Electricity Authority, New Zealand
- Eastern Energy - Thailand
- Siam City Cement - Thailand
- Kideco Jaya Agung - Indonesia
- Semirara Mining Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Ministry of Transport, Egypt
- Independent Power Producers Association of India
- Bayan Resources Tbk. - Indonesia
- PTC India Limited - India
- MS Steel International - UAE
- Goldman Sachs - Singapore
- Ambuja Cements Ltd - India
- San Jose City I Power Corp, Philippines
- Coastal Gujarat Power Limited - India
- Billiton Holdings Pty Ltd - Australia
- Riau Bara Harum - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Power Finance Corporation Ltd., India
- Jaiprakash Power Ventures ltd
- ICICI Bank Limited - India
- Planning Commission, India
- International Coal Ventures Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- CIMB Investment Bank - Malaysia
- Samtan Co., Ltd - South Korea
- Pendopo Energi Batubara - Indonesia
- VISA Power Limited - India
- Aboitiz Power Corporation - Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Carbofer General Trading SA - India
- Price Waterhouse Coopers - Russia
- Medco Energi Mining Internasional
- New Zealand Coal & Carbon
- Jindal Steel & Power Ltd - India
- Siam City Cement PLC, Thailand
- PowerSource Philippines DevCo
- Attock Cement Pakistan Limited
- Holcim Trading Pte Ltd - Singapore
- Leighton Contractors Pty Ltd - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Altura Mining Limited, Indonesia
- Antam Resourcindo - Indonesia
- IEA Clean Coal Centre - UK
- Intertek Mineral Services - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Bangladesh Power Developement Board
- Wilmar Investment Holdings
- ASAPP Information Group - India
- Kartika Selabumi Mining - Indonesia
- Gujarat Sidhee Cement - India
- Bhushan Steel Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Indogreen Group - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Global Business Power Corporation, Philippines
- Cement Manufacturers Association - India
- Barasentosa Lestari - Indonesia
- Posco Energy - South Korea
- Aditya Birla Group - India
- Economic Council, Georgia
- Renaissance Capital - South Africa
- Singapore Mercantile Exchange
- Directorate General of MIneral and Coal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- McConnell Dowell - Australia
- Salva Resources Pvt Ltd - India
- Ind-Barath Power Infra Limited - India
- Port Waratah Coal Services - Australia
- Orica Mining Services - Indonesia
- Sakthi Sugars Limited - India
- Formosa Plastics Group - Taiwan
- Central Java Power - Indonesia
- OPG Power Generation Pvt Ltd - India
- Merrill Lynch Commodities Europe
- TeaM Sual Corporation - Philippines
- Indika Energy - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- GVK Power & Infra Limited - India
- Grasim Industreis Ltd - India
- Thiess Contractors Indonesia
- Commonwealth Bank - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bharathi Cement Corporation - India
- Tamil Nadu electricity Board
- Maharashtra Electricity Regulatory Commission - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kumho Petrochemical, South Korea
- Bahari Cakrawala Sebuku - Indonesia
- Africa Commodities Group - South Africa
- SMC Global Power, Philippines
- Romanian Commodities Exchange
- Sinarmas Energy and Mining - Indonesia
- Oldendorff Carriers - Singapore
- India Bulls Power Limited - India
- European Bulk Services B.V. - Netherlands
- The University of Queensland
- SN Aboitiz Power Inc, Philippines
- Baramulti Group, Indonesia
- Maheswari Brothers Coal Limited - India
- Straits Asia Resources Limited - Singapore
- Chettinad Cement Corporation Ltd - India
- Star Paper Mills Limited - India
- Dalmia Cement Bharat India
- Mjunction Services Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Central Electricity Authority - India
- Bukit Asam (Persero) Tbk - Indonesia
- Chamber of Mines of South Africa
- Neyveli Lignite Corporation Ltd, - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Timah Investasi Mineral - Indoneisa
- Vizag Seaport Private Limited - India
- Essar Steel Hazira Ltd - India
- Meenaskhi Energy Private Limited - India
- Deloitte Consulting - India
- Ministry of Mines - Canada
- White Energy Company Limited
- Georgia Ports Authority, United States
- Trasteel International SA, Italy
- Edison Trading Spa - Italy
- Sojitz Corporation - Japan
- Xindia Steels Limited - India
- Alfred C Toepfer International GmbH - Germany
- Wood Mackenzie - Singapore
- Indonesian Coal Mining Association
- Lanco Infratech Ltd - India
- PNOC Exploration Corporation - Philippines
- Semirara Mining and Power Corporation, Philippines
- Mercator Lines Limited - India
- Global Coal Blending Company Limited - Australia
- Anglo American - United Kingdom
- Bulk Trading Sa - Switzerland
- Manunggal Multi Energi - Indonesia
- Malabar Cements Ltd - India
- Energy Development Corp, Philippines
- GAC Shipping (India) Pvt Ltd
- Larsen & Toubro Limited - India
- Heidelberg Cement - Germany
- The State Trading Corporation of India Ltd
- Cigading International Bulk Terminal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Iligan Light & Power Inc, Philippines
- Petron Corporation, Philippines
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