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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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Monday, 18 April 22
GOVT IN DISCUSSION WITH WORLD BANK ON FRAMEWORK FOR COAL MINE CLOSURE - BUSINESS STANDARD
The coal ministry is in discussions with the World Bank for collaboration on the mine closure framework, a government official said on Wednesday.
...
Monday, 18 April 22
DEMAND FOR THERMAL COAL TO RISE DUE TO INCREASE IN ELECTRICITY DEMAND: INDIAN COAL MINISTRY - PTI
Coal block allocatees have a golden opportunity to augment production as the demand for thermal coal will rise due to an increase in electricity de ...
Tuesday, 05 April 22
INDONESIAN COAL PRICE REFERENCE HITS RECORD ABOVE $288
COALspot.com: Indonesian Coal Price Reference for April in a steep climb from March 2022.
As expected, Russia – Ukraine war dr ...
Thursday, 31 March 22
CHINA STATE PLANNER ASKS COAL INDEX PROVIDERS TO RECTIFY IRREGULARITIES - REUTERS
China’s state planner has asked some major coal price index providers to rectify “severe irregularities” it had identified in the ...
Thursday, 31 March 22
IMPORTED COAL PRICES TO JUMP 55% IN APR-JUN, IMPACT INDIAN FIRMS: ICRA - LIVEMINT
Supply disruption owing to the Russia-Ukraine conflict could push the price of imported coal by 45-55% in Q1FY23 compared to the previous quarter, ...
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- Ministry of Finance - Indonesia
- Edison Trading Spa - Italy
- Semirara Mining and Power Corporation, Philippines
- Uttam Galva Steels Limited - India
- Commonwealth Bank - Australia
- Indogreen Group - Indonesia
- Wood Mackenzie - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Globalindo Alam Lestari - Indonesia
- Medco Energi Mining Internasional
- Coal and Oil Company - UAE
- Deloitte Consulting - India
- Jorong Barutama Greston.PT - Indonesia
- IEA Clean Coal Centre - UK
- Holcim Trading Pte Ltd - Singapore
- Krishnapatnam Port Company Ltd. - India
- Romanian Commodities Exchange
- White Energy Company Limited
- PowerSource Philippines DevCo
- Tamil Nadu electricity Board
- Rashtriya Ispat Nigam Limited - India
- Kumho Petrochemical, South Korea
- ASAPP Information Group - India
- Timah Investasi Mineral - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- TeaM Sual Corporation - Philippines
- Vedanta Resources Plc - India
- Cement Manufacturers Association - India
- Gujarat Sidhee Cement - India
- SMG Consultants - Indonesia
- Kapuas Tunggal Persada - Indonesia
- McConnell Dowell - Australia
- ICICI Bank Limited - India
- Merrill Lynch Commodities Europe
- Directorate General of MIneral and Coal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Parry Sugars Refinery, India
- Indonesian Coal Mining Association
- Planning Commission, India
- Semirara Mining Corp, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Coastal Gujarat Power Limited - India
- Aboitiz Power Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- Sojitz Corporation - Japan
- Mercator Lines Limited - India
- Iligan Light & Power Inc, Philippines
- Indian Energy Exchange, India
- Siam City Cement PLC, Thailand
- Interocean Group of Companies - India
- Toyota Tsusho Corporation, Japan
- Mjunction Services Limited - India
- Indo Tambangraya Megah - Indonesia
- Central Electricity Authority - India
- Binh Thuan Hamico - Vietnam
- The Treasury - Australian Government
- Renaissance Capital - South Africa
- IHS Mccloskey Coal Group - USA
- The University of Queensland
- Kalimantan Lumbung Energi - Indonesia
- San Jose City I Power Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- Latin American Coal - Colombia
- Billiton Holdings Pty Ltd - Australia
- Coalindo Energy - Indonesia
- Trasteel International SA, Italy
- CIMB Investment Bank - Malaysia
- Electricity Authority, New Zealand
- VISA Power Limited - India
- Bangladesh Power Developement Board
- Australian Commodity Traders Exchange
- Agrawal Coal Company - India
- Ambuja Cements Ltd - India
- Oldendorff Carriers - Singapore
- Bukit Makmur.PT - Indonesia
- European Bulk Services B.V. - Netherlands
- Bhoruka Overseas - Indonesia
- Antam Resourcindo - Indonesia
- Straits Asia Resources Limited - Singapore
- Borneo Indobara - Indonesia
- Savvy Resources Ltd - HongKong
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Asmin Koalindo Tuhup - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- OPG Power Generation Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
- Ministry of Transport, Egypt
- Salva Resources Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- LBH Netherlands Bv - Netherlands
- Indian Oil Corporation Limited
- GN Power Mariveles Coal Plant, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sarangani Energy Corporation, Philippines
- Minerals Council of Australia
- Economic Council, Georgia
- Georgia Ports Authority, United States
- Essar Steel Hazira Ltd - India
- CNBM International Corporation - China
- Banpu Public Company Limited - Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- The State Trading Corporation of India Ltd
- Parliament of New Zealand
- Malabar Cements Ltd - India
- Madhucon Powers Ltd - India
- GMR Energy Limited - India
- Global Coal Blending Company Limited - Australia
- SN Aboitiz Power Inc, Philippines
- Larsen & Toubro Limited - India
- Price Waterhouse Coopers - Russia
- Tata Chemicals Ltd - India
- Energy Development Corp, Philippines
- Attock Cement Pakistan Limited
- London Commodity Brokers - England
- Xindia Steels Limited - India
- MS Steel International - UAE
- Ministry of Mines - Canada
- Chamber of Mines of South Africa
- Meralco Power Generation, Philippines
- Port Waratah Coal Services - Australia
- Marubeni Corporation - India
- Indika Energy - Indonesia
- Makarim & Taira - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Standard Chartered Bank - UAE
- Jaiprakash Power Ventures ltd
- Miang Besar Coal Terminal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Kartika Selabumi Mining - Indonesia
- Riau Bara Harum - Indonesia
- Bhatia International Limited - India
- International Coal Ventures Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Videocon Industries ltd - India
- Metalloyd Limited - United Kingdom
- Directorate Of Revenue Intelligence - India
- Kepco SPC Power Corporation, Philippines
- Global Business Power Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Karbindo Abesyapradhi - Indoneisa
- Pendopo Energi Batubara - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Power Finance Corporation Ltd., India
- Sakthi Sugars Limited - India
- Altura Mining Limited, Indonesia
- Bulk Trading Sa - Switzerland
- Heidelberg Cement - Germany
- Sical Logistics Limited - India
- Baramulti Group, Indonesia
- Thiess Contractors Indonesia
- Ind-Barath Power Infra Limited - India
- Meenaskhi Energy Private Limited - India
- SMC Global Power, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- India Bulls Power Limited - India
- South Luzon Thermal Energy Corporation
- Electricity Generating Authority of Thailand
- GVK Power & Infra Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Jindal Steel & Power Ltd - India
- Africa Commodities Group - South Africa
- Formosa Plastics Group - Taiwan
- Eastern Energy - Thailand
- Intertek Mineral Services - Indonesia
- Mercuria Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Aditya Birla Group - India
- New Zealand Coal & Carbon
- Thai Mozambique Logistica
- Central Java Power - Indonesia
- Australian Coal Association
- Vizag Seaport Private Limited - India
- Bukit Baiduri Energy - Indonesia
- Bharathi Cement Corporation - India
- Global Green Power PLC Corporation, Philippines
- PTC India Limited - India
- Goldman Sachs - Singapore
- Karaikal Port Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Singapore Mercantile Exchange
- Barasentosa Lestari - Indonesia
- Simpson Spence & Young - Indonesia
- Siam City Cement - Thailand
- Kobexindo Tractors - Indoneisa
- Orica Australia Pty. Ltd.
- GAC Shipping (India) Pvt Ltd
- Posco Energy - South Korea
- Manunggal Multi Energi - Indonesia
- Grasim Industreis Ltd - India
- Eastern Coal Council - USA
- Energy Link Ltd, New Zealand
- Mintek Dendrill Indonesia
- Carbofer General Trading SA - India
- Dalmia Cement Bharat India
- Bayan Resources Tbk. - Indonesia
- Petron Corporation, Philippines
- Orica Mining Services - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Sindya Power Generating Company Private Ltd
- Ceylon Electricity Board - Sri Lanka
- Offshore Bulk Terminal Pte Ltd, Singapore
- Neyveli Lignite Corporation Ltd, - India
- Bhushan Steel Limited - India
- Samtan Co., Ltd - South Korea
- Lanco Infratech Ltd - India
- Chettinad Cement Corporation Ltd - India
- Kaltim Prima Coal - Indonesia
- Star Paper Mills Limited - India
- Wilmar Investment Holdings
- Rio Tinto Coal - Australia
- Anglo American - United Kingdom
- Independent Power Producers Association of India
- PNOC Exploration Corporation - Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Alfred C Toepfer International GmbH - Germany
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