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Thursday, 04 March 10
GLOBAL COAL PRICES GETS SUPPORT FROM EM DEMAND
 Commodity Online reported that, AP12 coal prices look well supported in 2010 thanks to positive outlook for Chinese coal demand whereas coal demand in Europe, rest of the world is shockingly low and stocks have hardly drawn despite the coldest winter in decades, according to an analysis by Bank of America- Merrill Lynch (BofAML).
Japan, by far the biggest importer of thermal coal, cut back on its appetite for coal by almost 20 million mt last year, to 117million mt. Europe took in 22 million metric tons less last year, driven particularly by Spain, Italy, the UK and France as low natural gas prices supported switching out of coal in the power sector
Last year China imported 70.4 mn mt of thermal coal, relative to outflows of 7.8 mn in 2008. China's imports will witness slowdown due to ramping up of internal proudction, according to BofAML.
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“Last year China imported 70.4 mln mt of thermal coal, relative to outflows of 7.8 mln in 2008. China's imports will witness slowdown due to ramping up of internal production” - BofAML
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Coal prices are protected to the downside by the high marginal cost of production, particularly in Russia. However, the oversupply in Europe will likely keep a lid on API2 prices near-term.
API2 front month coal increased from a low of $75/mt in mid December to $97/mt in early January, sharply outpacing other energy markets. Heavy snowstorms led to local power shortages, particularly in the South of the country.
Perhaps more importantly, a much stronger-than-expected cyclical rebound in China drove power generation growth to new highs, up 33% YoY over the past three months, helping to fuel coal demand. Other Asian countries also experienced a turn-around in electricity generation. In turn, due to the heavy snowfall and rail constraints, China resorted to seaborne coal as opposed to domestically produced material. Elsewhere, a glaringly cold winter in Europe provided some support to sentiment. Producer infrastructure constraints, particularly in Australia, South Africa and Indonesia, temporarily tightened the international coal market.
Ultimately, the 3-week rally in coal did not last and prices reversed sharply in mid January as the snowfalls in China receded and the USD strengthened. In recent weeks, front-month API2 coal traded down to $72.75/mt and has been in the $72/mt to $79/mt range. Chinese imports in January, though still at a very high level, cooled off month-on-month basis. Moreover, big European coal users, like Germany, France and the UK, recorded steep demand losses in January, at a time that they experienced the sharpest winter in decade, BofAML analysis said.
In the UK for instance, coal demand in December equalled 4.6 million mt, down from 6.3 million mt in the prior year. Preliminary data indicates that the trend continued over the past weeks.
Traditional European coal suppliers are doing what they can to manage supply to Europe. Russia has reportedly closed some mines to keep exports to Europe low. South Africa is actively diversifying away from Europe towards demand outlets in Asia Pacific. During 2009, 31% of South African exports went to India, from virtually nothing in previous years. That trend was particularly pronounced over the past months. Although in small volumes, South Africa has also been pushing material into China. More absurdly, Colombia-- who typically exports 50-60% of their coal to Europe with the balance going to the Americas--
has now detected interest in Asia.
Colombia exported small volumes to China in December to the tune of 1.5-1.7 million mt, for the first time ever. Of course, sharply lower freight rates are helping these trade flows. As we see continued supply of new Capesize vessels in 2010, freight will likely remain cheap by historical standards in the near-term. Once freight recovers, possibly at the end of this year with the cyclical demand recovery soaking up the supply in ships, these trade-flows are unlikely to be sustainable.
Europe's coal inventories remain at excessive levels at key import ports in Rotterdam and Amsterdam as supply exceeds demand. BofAML sses strong relationship between spreads in AP12 and coal inventories. Hence it is no surprise that the contango in API2 has steepened even more, with front month to front calendar year spreads at the widest since July last year , reflecting the oversupply in the European market and bulging inventories.
Coal markets in the Pacific are a lot tighter, with inventories relatively low in key coal consumers like China, India and South Korea. Meanwhile, the Newcastle coal market is trading in backwardation. Several coal mines in Australia had to declare force majeure in response to severe rainfalls on the east coast which flooded mines, while major rail lines had to close, clogging up the coal chain infrastructure. 47 vessels are currently again lining up outside Newcastle , underscoring that infrastructure problems will not go away easily, BofAML analysis said.
Overall, the outlook for emerging market coal demand remains very positive though. China is expected buy more seaborne coal as as the Chinese Renminbi is likely to be revalued by mid year. In BofAMl analysis, a CNY revaluation is undoubtedly positive for global thermal coal prices. Other EMs likeMexico and Turkey are sharply ramping up coal imports. India continues to suffer from a negative coal balance and will have to rely on the seaborne market for supplies. On a medium-term horizon, we believe that global seaborne coal prices have immense upside from the current level given the growth in coal-fired generation capacity.
Source:Commodity Online - By Madhurima R S
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Tuesday, 23 February 10
UAE COMPANY TO ACQUIRE CONTROL OF ALLBOND MAKMUR
The Jakarta globe reported that, Renuka Energy Resources Holding, based in the United Arab Emirates, has signed an agreement to acquire 80 percent o ...
Tuesday, 23 February 10
CIL SHORTLISTS 24 FOREIGN COS FOR JV
India's Economic Times reported that, Coal India has shortlisted 24 foreign firms — six each from the US, Australia, South Africa and Indones ...
Saturday, 20 February 10
THE FREIGHT MARKET CONTINUED TO BE SOFT THIS WEEK - CAPT. REDDY
COALspot.com: The freight market continued to be soft this week as still affect of Chinese new year holidays continue. However the index overall had ...
Friday, 19 February 10
MAKING THE JOINT COOPERATION OF PRIVATE GOVERNMENT IN INDONESIA
COALspot.com - Press Release
1. Revision of the presidential decree 67/2005 has been signed by the President on January 28, 2010 with the public ...
Thursday, 18 February 10
THE INDIAN MARKET IS FIRMING A BIT, DUE TO LACK OF TONNAGE IN THE REGION
HANDY
The BSI still decline as holidays around the world have reduced trading.
...
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- VISA Power Limited - India
- Bhoruka Overseas - Indonesia
- Parliament of New Zealand
- Kobexindo Tractors - Indoneisa
- Globalindo Alam Lestari - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Interocean Group of Companies - India
- Aditya Birla Group - India
- Goldman Sachs - Singapore
- ASAPP Information Group - India
- Bukit Makmur.PT - Indonesia
- Larsen & Toubro Limited - India
- Trasteel International SA, Italy
- Price Waterhouse Coopers - Russia
- Savvy Resources Ltd - HongKong
- Baramulti Group, Indonesia
- Romanian Commodities Exchange
- Salva Resources Pvt Ltd - India
- Tamil Nadu electricity Board
- Aboitiz Power Corporation - Philippines
- Heidelberg Cement - Germany
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- Kaltim Prima Coal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
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- Eastern Coal Council - USA
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- Kumho Petrochemical, South Korea
- Sarangani Energy Corporation, Philippines
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- Meralco Power Generation, Philippines
- Vizag Seaport Private Limited - India
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- GVK Power & Infra Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Mintek Dendrill Indonesia
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- Semirara Mining Corp, Philippines
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- Ministry of Finance - Indonesia
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- The Treasury - Australian Government
- Straits Asia Resources Limited - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Africa Commodities Group - South Africa
- Indonesian Coal Mining Association
- Alfred C Toepfer International GmbH - Germany
- Videocon Industries ltd - India
- Chamber of Mines of South Africa
- Power Finance Corporation Ltd., India
- Deloitte Consulting - India
- The University of Queensland
- TeaM Sual Corporation - Philippines
- Pendopo Energi Batubara - Indonesia
- Bukit Baiduri Energy - Indonesia
- Siam City Cement PLC, Thailand
- Grasim Industreis Ltd - India
- London Commodity Brokers - England
- Global Business Power Corporation, Philippines
- Indika Energy - Indonesia
- Indogreen Group - Indonesia
- Commonwealth Bank - Australia
- SMC Global Power, Philippines
- IHS Mccloskey Coal Group - USA
- San Jose City I Power Corp, Philippines
- Uttam Galva Steels Limited - India
- South Luzon Thermal Energy Corporation
- CNBM International Corporation - China
- Kepco SPC Power Corporation, Philippines
- Indian Oil Corporation Limited
- Bahari Cakrawala Sebuku - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Formosa Plastics Group - Taiwan
- Directorate Of Revenue Intelligence - India
- Gujarat Mineral Development Corp Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Electricity Generating Authority of Thailand
- Intertek Mineral Services - Indonesia
- IEA Clean Coal Centre - UK
- Directorate General of MIneral and Coal - Indonesia
- Wood Mackenzie - Singapore
- Madhucon Powers Ltd - India
- McConnell Dowell - Australia
- Vedanta Resources Plc - India
- Kohat Cement Company Ltd. - Pakistan
- Coal and Oil Company - UAE
- GMR Energy Limited - India
- Marubeni Corporation - India
- Malabar Cements Ltd - India
- CIMB Investment Bank - Malaysia
- Renaissance Capital - South Africa
- Indian Energy Exchange, India
- Ministry of Mines - Canada
- Edison Trading Spa - Italy
- Bank of Tokyo Mitsubishi UFJ Ltd
- Essar Steel Hazira Ltd - India
- Manunggal Multi Energi - Indonesia
- Meenaskhi Energy Private Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Attock Cement Pakistan Limited
- Central Electricity Authority - India
- Sree Jayajothi Cements Limited - India
- Kartika Selabumi Mining - Indonesia
- Chettinad Cement Corporation Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Toyota Tsusho Corporation, Japan
- TNB Fuel Sdn Bhd - Malaysia
- Electricity Authority, New Zealand
- Semirara Mining and Power Corporation, Philippines
- Singapore Mercantile Exchange
- GN Power Mariveles Coal Plant, Philippines
- Mercator Lines Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- SMG Consultants - Indonesia
- Minerals Council of Australia
- Sindya Power Generating Company Private Ltd
- Ind-Barath Power Infra Limited - India
- SN Aboitiz Power Inc, Philippines
- Australian Commodity Traders Exchange
- Xindia Steels Limited - India
- PTC India Limited - India
- Sical Logistics Limited - India
- Bharathi Cement Corporation - India
- Oldendorff Carriers - Singapore
- Krishnapatnam Port Company Ltd. - India
- Barasentosa Lestari - Indonesia
- Star Paper Mills Limited - India
- Rashtriya Ispat Nigam Limited - India
- Petron Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Standard Chartered Bank - UAE
- Indo Tambangraya Megah - Indonesia
- Mjunction Services Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Simpson Spence & Young - Indonesia
- Tata Chemicals Ltd - India
- Thiess Contractors Indonesia
- Coastal Gujarat Power Limited - India
- Orica Australia Pty. Ltd.
- Antam Resourcindo - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- OPG Power Generation Pvt Ltd - India
- PowerSource Philippines DevCo
- Borneo Indobara - Indonesia
- Australian Coal Association
- Bhushan Steel Limited - India
- Timah Investasi Mineral - Indoneisa
- Bayan Resources Tbk. - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Cement Manufacturers Association - India
- MS Steel International - UAE
- New Zealand Coal & Carbon
- Eastern Energy - Thailand
- Rio Tinto Coal - Australia
- Bhatia International Limited - India
- Global Coal Blending Company Limited - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Economic Council, Georgia
- Dalmia Cement Bharat India
- Metalloyd Limited - United Kingdom
- Iligan Light & Power Inc, Philippines
- PNOC Exploration Corporation - Philippines
- Jaiprakash Power Ventures ltd
- Altura Mining Limited, Indonesia
- Bangladesh Power Developement Board
- Ceylon Electricity Board - Sri Lanka
- Riau Bara Harum - Indonesia
- Planning Commission, India
- Samtan Co., Ltd - South Korea
- Karaikal Port Pvt Ltd - India
- Carbofer General Trading SA - India
- Thai Mozambique Logistica
- White Energy Company Limited
- LBH Netherlands Bv - Netherlands
- International Coal Ventures Pvt Ltd - India
- Makarim & Taira - Indonesia
- Jindal Steel & Power Ltd - India
- Sojitz Corporation - Japan
- PetroVietnam Power Coal Import and Supply Company
- Energy Development Corp, Philippines
- Port Waratah Coal Services - Australia
- Medco Energi Mining Internasional
- GAC Shipping (India) Pvt Ltd
- The State Trading Corporation of India Ltd
- Posco Energy - South Korea
- Parry Sugars Refinery, India
- Ministry of Transport, Egypt
- Orica Mining Services - Indonesia
- Latin American Coal - Colombia
- Binh Thuan Hamico - Vietnam
- Bulk Trading Sa - Switzerland
- Merrill Lynch Commodities Europe
- European Bulk Services B.V. - Netherlands
- Maheswari Brothers Coal Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Energy Link Ltd, New Zealand
- India Bulls Power Limited - India
- Therma Luzon, Inc, Philippines
- Georgia Ports Authority, United States
- Coalindo Energy - Indonesia
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