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Wednesday, 07 December 22
MARKET INSIGHT - INTERMODAL
 China’s coal imports from January to October were 230.1m mt, a decrease of around 10.7% y-o-y (2021 totalled 323.2m mt). The question is if this negative momentum will remain in 2023, pressuring the Dry Baltic index. While the easing of Chinese Covid strict policies which coupled with the 70% coal reliance of North China for its heating boiler amidst the upcoming colder winter can trigger a demand boost for coal, we will focus on some adverse fundamentals which point to pessimistic expectations for its 2023 seaborne coal imports.
Domestic coal output on a rise.
Chinese total coal output of 4.12 billion mt in 2021 contributed around 92% of its total consumptions with 2021 imports standing at 323 million mt. In 2022, domestic production during the first three quarters stood 3.32 billion mt, an increase of +14% compared to 2021 first 3 quarters while the 2022 October output of 370m mt is up by +13m mt compared to October 2021 output. While coal represents almost 55% of China’s energy consumption and half of coal plant expansions (+197GW) are attributed to China, a growth of around 27% of its domestic coal mining capacity could cover this increase in demand. Indeed, 559m mt of coal mines are under construction and proposed as of January 2022 in China, representing 29% of the global share followed by Australia, India, and Russia. In the short-term, a shift in local production is strengthened by policymakers' decision to support national foreign reserves while the appreciation of US$ is leading to higher coal prices for Chinese power plants thus diminishing their profit margin. In addition to that, amidst the current geopolitical tension and its effect on global trade with increases materializing across all the energy commodities globally, we believe that China will keep focusing on its national power security by keeping its inventory levels high through its local production. Indeed, current levels standing at 326.7 million mt as of the end of September which is +45% above the historical average of 225m mt and +217m mt compared to the same period last year. Covid-zero Policy will determine the growth of coal demand which however remains subdued. While Covid-19 policy relaxation has begun we do not expect that a full re-opening will take place no earlier than the end of Q12023 further trimming its coal demand.
New trade patterns in question.
China's main source of coal is Indonesia with 133 million mt (98% thermal coal) being delivered so far in 2022, followed by Russia and Mongolia with 54.01m mt (68% thermal coal) and 22.38m mt (85% metallurgical coal) respectively. While Indonesia will remain the largest supplier of coal to China yet with a fall of -16.19% so far in the first ten months of 2022 compared to the same period in 2021, the rest two nations have significantly increased their market share with Mongolia and Russia posting an increase of +60% and +12.8% respectively. While ton-mile demand is benefited from cheaper Russian coal due to European sanctions and the need to alter its trade partners, an increase in Mongolian exports could absorb a share of Russian coking coal exports especially given the recent Russian transport infrastructure limitation which leads to delays in loading and arrivals. Having said that, the new Mongolian 233km Tavan Tolgoi rail line which is estimated to cut transport costs to around US$8 per tonne compared to truck transport costs, could point towards this shift. According to the president of Mongolia, this new rail line could increase coal exports to China to 50m tonnes compared to 22.38 million so far in 2022 and its record 36.24 million tonnes in 2018. In addition to this shift, other seaborne sources of metallurgical coal namely the US, Indonesia, and Canada could see their exports further decreasing from Mongolian ones. As far as the Mongolian thermal coal exports are concerned, an increase of 61% (+1.23 million mt) has materialized during the first ten months of 2022 compared to the whole of 2021. With rail infrastructure expansions, Mongolian thermal coal exports could also increase further. The real question is, does China needs all this coal? If not, based on this year's demand, decisions will be made based on costs and transport delays and in that scenario, Mongolian exports could benefit further.
By Yiannis Parganas,
Head of Research Department
Compiled by:
Intermodal Research & Valuations
Analysts:
Yiannis Parganas
Tamara Apostolou
Disclaimer and legal disclosure: For any further queries please do not hesitate to contact our Research & Valuations Department. The information contained in this report has been obtained from various sources, as reported in the market. Intermodal Shipbrokers Co. believes such information to be factual and reliable without making guarantees regarding its accuracy or completeness. Whilst every care has been taken in the production of the above review, no liability can be accepted for any loss or damage incurred in any way whatsoever by any person who may seek to rely on the information and views contained in this material. This report is being produced for the internal use of the intended recipients only and no reproducing is allowed, without the prior written authorization of Intermodal Shipbrokers Co.
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Tuesday, 17 January 23
CHINA'S SHANXI TARGETS 2023 COAL PRODUCTION OF NEARLY 1.37B TONS - XINHUA
China’s coal-rich province of Shanxi has set a coal production target of nearly 1.37 billion metric tons for 2023, according to a government ...
Tuesday, 17 January 23
MARKET INSIGHT - INTERMODAL
Rumor has it that the New Year has come, to set the pace in, for Russia to continue hostilities against Ukraine. Ten months on the go, into Russia& ...
Tuesday, 17 January 23
INDONESIA IS ACCOUNTING FOR 32.3% OF THE GLOBAL SEABORNE COAL MARKET IN 2022 - BENCHERO COSTA
After a slow start in the first quarter, global coal trade has really picked up pace last year, and is now fully back to pre-Covid levels, Benchero ...
Tuesday, 10 January 23
INDONESIAN HBA IS SEEING A SPIKE IN JANUARY 2023 INSTEAD OF A SIGNIFICANT FALL IN DECEMBER 2022
COALspot.com: Indonesian Coal Price Reference up 8.43% in January 2023.
HBA is seeing a dramatic spike in January 2023 i ...
Sunday, 08 January 23
INDIAN COAL POWER PLANTS SHOULD BE COMPENSATED FOR 2022 FORCED GENERATION – REGULATOR : REUTERS
Indian power plants that rely on imported coal should be fully compensated when forced to supply electricity, the country’s power regulator s ...
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- Parliament of New Zealand
- Latin American Coal - Colombia
- Economic Council, Georgia
- Maharashtra Electricity Regulatory Commission - India
- Meenaskhi Energy Private Limited - India
- Semirara Mining and Power Corporation, Philippines
- SMC Global Power, Philippines
- Chettinad Cement Corporation Ltd - India
- Electricity Generating Authority of Thailand
- GN Power Mariveles Coal Plant, Philippines
- Standard Chartered Bank - UAE
- Bangladesh Power Developement Board
- New Zealand Coal & Carbon
- Gujarat Sidhee Cement - India
- Africa Commodities Group - South Africa
- CNBM International Corporation - China
- Vizag Seaport Private Limited - India
- Electricity Authority, New Zealand
- OPG Power Generation Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Bukit Makmur.PT - Indonesia
- Georgia Ports Authority, United States
- Vedanta Resources Plc - India
- Cigading International Bulk Terminal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- Formosa Plastics Group - Taiwan
- Heidelberg Cement - Germany
- Kobexindo Tractors - Indoneisa
- Kaltim Prima Coal - Indonesia
- Bhushan Steel Limited - India
- Meralco Power Generation, Philippines
- GAC Shipping (India) Pvt Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- Attock Cement Pakistan Limited
- Bhoruka Overseas - Indonesia
- Cement Manufacturers Association - India
- Bukit Asam (Persero) Tbk - Indonesia
- Banpu Public Company Limited - Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Romanian Commodities Exchange
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhatia International Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Kapuas Tunggal Persada - Indonesia
- ICICI Bank Limited - India
- Thai Mozambique Logistica
- LBH Netherlands Bv - Netherlands
- Port Waratah Coal Services - Australia
- Edison Trading Spa - Italy
- AsiaOL BioFuels Corp., Philippines
- Videocon Industries ltd - India
- Wood Mackenzie - Singapore
- Power Finance Corporation Ltd., India
- Mercuria Energy - Indonesia
- The University of Queensland
- Riau Bara Harum - Indonesia
- Goldman Sachs - Singapore
- Energy Development Corp, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Independent Power Producers Association of India
- Ministry of Transport, Egypt
- TeaM Sual Corporation - Philippines
- Global Business Power Corporation, Philippines
- Interocean Group of Companies - India
- Gujarat Mineral Development Corp Ltd - India
- IEA Clean Coal Centre - UK
- Iligan Light & Power Inc, Philippines
- Anglo American - United Kingdom
- Directorate Of Revenue Intelligence - India
- Merrill Lynch Commodities Europe
- Mercator Lines Limited - India
- IHS Mccloskey Coal Group - USA
- Global Coal Blending Company Limited - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Eastern Energy - Thailand
- India Bulls Power Limited - India
- International Coal Ventures Pvt Ltd - India
- Kumho Petrochemical, South Korea
- Planning Commission, India
- Billiton Holdings Pty Ltd - Australia
- Deloitte Consulting - India
- PTC India Limited - India
- Australian Coal Association
- MS Steel International - UAE
- Binh Thuan Hamico - Vietnam
- Coastal Gujarat Power Limited - India
- Krishnapatnam Port Company Ltd. - India
- CIMB Investment Bank - Malaysia
- Samtan Co., Ltd - South Korea
- Coal and Oil Company - UAE
- Bulk Trading Sa - Switzerland
- Baramulti Group, Indonesia
- Timah Investasi Mineral - Indoneisa
- Ministry of Mines - Canada
- Maheswari Brothers Coal Limited - India
- Marubeni Corporation - India
- Indogreen Group - Indonesia
- Kideco Jaya Agung - Indonesia
- Sree Jayajothi Cements Limited - India
- Makarim & Taira - Indonesia
- PowerSource Philippines DevCo
- Antam Resourcindo - Indonesia
- Globalindo Alam Lestari - Indonesia
- Orica Australia Pty. Ltd.
- Global Green Power PLC Corporation, Philippines
- SMG Consultants - Indonesia
- Posco Energy - South Korea
- Ind-Barath Power Infra Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Petron Corporation, Philippines
- Sojitz Corporation - Japan
- Toyota Tsusho Corporation, Japan
- European Bulk Services B.V. - Netherlands
- Aboitiz Power Corporation - Philippines
- Eastern Coal Council - USA
- Tata Chemicals Ltd - India
- Sarangani Energy Corporation, Philippines
- Sical Logistics Limited - India
- Indonesian Coal Mining Association
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GVK Power & Infra Limited - India
- ASAPP Information Group - India
- Indika Energy - Indonesia
- Mintek Dendrill Indonesia
- Agrawal Coal Company - India
- McConnell Dowell - Australia
- Xindia Steels Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Orica Mining Services - Indonesia
- Ambuja Cements Ltd - India
- Aditya Birla Group - India
- Tamil Nadu electricity Board
- Simpson Spence & Young - Indonesia
- Dalmia Cement Bharat India
- Price Waterhouse Coopers - Russia
- Lanco Infratech Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Holcim Trading Pte Ltd - Singapore
- San Jose City I Power Corp, Philippines
- Carbofer General Trading SA - India
- Indo Tambangraya Megah - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Siam City Cement PLC, Thailand
- Kartika Selabumi Mining - Indonesia
- Jindal Steel & Power Ltd - India
- Indian Oil Corporation Limited
- Rashtriya Ispat Nigam Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Karaikal Port Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Kepco SPC Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Straits Asia Resources Limited - Singapore
- Sakthi Sugars Limited - India
- Indian Energy Exchange, India
- PetroVietnam Power Coal Import and Supply Company
- Coalindo Energy - Indonesia
- Altura Mining Limited, Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Uttam Galva Steels Limited - India
- Singapore Mercantile Exchange
- The State Trading Corporation of India Ltd
- Central Electricity Authority - India
- Star Paper Mills Limited - India
- GMR Energy Limited - India
- Bukit Baiduri Energy - Indonesia
- The Treasury - Australian Government
- Wilmar Investment Holdings
- Commonwealth Bank - Australia
- Ministry of Finance - Indonesia
- Medco Energi Mining Internasional
- Neyveli Lignite Corporation Ltd, - India
- Larsen & Toubro Limited - India
- Madhucon Powers Ltd - India
- Grasim Industreis Ltd - India
- Rio Tinto Coal - Australia
- Kalimantan Lumbung Energi - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Australian Commodity Traders Exchange
- White Energy Company Limited
- Metalloyd Limited - United Kingdom
- Renaissance Capital - South Africa
- PNOC Exploration Corporation - Philippines
- Manunggal Multi Energi - Indonesia
- Parry Sugars Refinery, India
- London Commodity Brokers - England
- Trasteel International SA, Italy
- Sindya Power Generating Company Private Ltd
- Semirara Mining Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Chamber of Mines of South Africa
- South Luzon Thermal Energy Corporation
- Petrochimia International Co. Ltd.- Taiwan
- Bayan Resources Tbk. - Indonesia
- Central Java Power - Indonesia
- Thiess Contractors Indonesia
- Mjunction Services Limited - India
- Minerals Council of Australia
- Intertek Mineral Services - Indonesia
- VISA Power Limited - India
- Salva Resources Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Bharathi Cement Corporation - India
- Malabar Cements Ltd - India
- Borneo Indobara - Indonesia
- Essar Steel Hazira Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Energy Link Ltd, New Zealand
- Oldendorff Carriers - Singapore
- Siam City Cement - Thailand
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