We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Monday, 27 December 10
ANALYSIS: CHINA'S COAL PRODUCTION MISMATCHED WITH DOMESTIC DEMAND
 As reported by iStock Analyst, China's coal market has been trapped in a strange cycle. Large coal production bases are facing overcapacity, while large coal consumption provinces are in short supply of power coal.
This structural contradiction between supply and demand in China's coal market has highlighted heated discussions recently.
Coal producers facing mounting pressure of excess in output capacity
China is facing severe excess of production capacity and oversupply of coal in 2010 due to the expansion of coal production and surging imports amid sluggish demand, and this situation is expected to carry on into 2011 as new coal companies begin operation.
Wang Zhanjun, director-general of the China Coal (TSXV:CKO) Industry Association, said that China's coal supply capacity has seen a remarkable increase in 2010 due to the operation of newly formed coal companies after mergers and acquisitions.
In the first 11 months of 2010, the country's leading coal producing provinces and regions including Shanxi, Inner Mongolia, Shaanxi, and Ningxia all saw more than 20 percent growth in coal output.
According to a report by the association, in the first 11 months of 2010 China's coal output surged 15.5 percent or 418 million metric tons (tonnes) year on year to 3.039 billion tonnes, while coal sales were up 13.5 percent or 390 million tonnes to 2.892 billion tonnes. Coal deliveries increased by 15.3 percent year on year to 1.827 billion tonnes during the same period.
The investment in fixed assets in the coal industry has continued to increase this year. In the first 11 months of 2010, fixed assets investment in coal mining and washing saw 22.7 percent year-on-year growth to 320.7 billion yuan.
Meanwhile, China's coal imports keep rising while exports keep declining. In January-November, China's coal exports dropped 13.5 percent to 17.58 million tonnes, and are expected to remain low in December. Total coal exports are estimated at 19 million tonnes for the whole year.
In sharp contrast to declining exports, coal imports maintained fast growth in 2010. Net imports of coal are expected to reach 145 million tonnes in 2010.
However, China's coal demand has remained sluggish this year. Affected by the measures for energy conservation and emissions reduction, electricity consumption growth of high energy-consuming industries like ferrous metals, chemicals, non-ferrous metals, and building materials has fallen back quickly since May of 2010, which in turn has cut coal consumption severely.
Coal consumption in the steel industry moved from positive growth to negative growth in 2010.
According to official statistics, China's daily crude steel output saw fast growth in the first half of 2010 but registered three months of negative growth in the third quarter, and only increased 4.8 percent in November.
Also, coal consumption in the chemicals industry has also remained sluggish this year. According to preliminary forecasts, coal consumption in the chemicals industry in 2010 will stay at the same level as in 2009, at 140 million tonnes.
The China Electricity Council predicted that electricity demand in China would not increase much in 2010 and 2011, estimating the growth at 10 percent in 2010, 14 percentage points lower than in 2009.
Therefore, coal industry is expected to face mounting oversupply pressure in 2011 since the output of majority coal enterprises would double. Meanwhile, large numbers of coalmines in Shanxi, Henan, Shaanxi, and Inner Mongolia are scheduled to begin operation in 2011, and the coal oversupply will be aggravated by the participation of more downstream firms in power generation and metallurgy, said Wang Zhanjun, head of the China Coal Industry Association.
Wang predicted that coal supply in China would increase 300 million tonnes in 2011, and China would face excess in supply of coal.
Short supply of coal at power plants
In sharp contrast with the excessive output and supply of coal, a number of power plants in parts of China are suffering from shortages of power coal.
In Guizhou province, coal output capacity is significantly less than demand. The local coal output is expected to increase by 160 million tonnes at most in 2011, which would exacerbate the tight supply. This is because the output capacity of newly formed coalmines is inadequate to make up for eliminated production capacity, and the newly formed capacity will not come into operation until the second half of 2011.
At the same time, power plants in Guizhou cannot afford coal produced outside the province because of higher coal prices.
Similar short supply of coal has also occurred in Hubei province. Coal stocks at power plants in Hubei have remained at critical level since the beginning of this year, and sometimes were even not enough for one week's consumption.
The power coal shortage is not only a headache for power plants in non-coal production areas, but also hit power plants in major coal production areas like Shanxi and Henan.
Take the Datang Taiyuan Second Thermal Power Plant for example. The plant has suffered coal shortages four times since the beginning of 2010 because its contracted coal supplier supplied only 400,000 tonnes of coal towards meeting the 1.5-million-tonne coal contract.
As of December 4, power coal stocks of Henan have slid sharply from 3.84 million tonnes at the beginning of November to 2.65 million tonnes, far below the critical level of 3.5 million tonnes.
This has led to a daily supply shortage of 700,000 tonnes. Current coal production system might be primary cause
The short supply of power coal against excess of overall output capacity in China is believed to be caused mainly by system contradictions existing in the coal industry.
Actually, China's coal industry has trapped in a strange circle. Coal demand weakens after power plants stockpile power coal, but after the stockpiling, coal stocks of coal producers are down. Therefore, the coalmines produce more coal, which eventually leads to excess of output and excessive supply of coal.
Some coal suppliers have complained that if they carry on supplying coal according to their coal contracts with the power plants at the contracted price, the coalmines would all suffer (OOTC:WLVTQ) losses while the power plants all make profits.
A senior manager of the Shenhua Group said that it is difficult to avoid the structural contradictions of disjointed coal output and demand under the current government-capped management system. The outlook of China's coal industry remains troubled for 2011, and the problem of excessive output capacity would continue to be widespread in China, especially in western areas.
According to the manager, branches of the Shenhua Group in Xinjiang are all in the red due to heavy coal inventory pressure, while some provinces in east and south China are suffering from severe shortages of coal.
An insider with the Shanxi Coking Coal Group said that the group was ambitiously planning to double its output capacity during the period of the 12th Five Year Plan (2011-15), but the current market environment is very unfavorable for the coal industry. The cost of acquiring small coalmines has spiraled far beyond expectations.
Therefore, the mismatch between coal supply and demand at the turn of the new year is manageable, and the market is expected to see increasing supply and decreasing demand soon, noted the insider.
But Wang Xianzheng expressed disagreement. He believed that China's coal demand would increase by 200 million to 300 million tonnes in 2011. Besides which, the government-planned construction of 10 million units of affordable housing would drive coal demand by 60 million tonnes at least. Wang believed that the coal price would remain buoyant in 2011 but would not rise much.
Source: Quotemedia, Xinhua News Agency (Edited by Li Xiaohui), istockanalyst
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Friday, 28 June 24
INDIAN POWER STATIONS STOCKED WITH BUMPER COAL SUPPLY AS TRANSPORT WOES EASE - BUSINESS STANDARD
Even as power demand has touched a historic high of 250 gigawatts (Gw) amid sweltering heat this June, India’s power stations are stocked wit ...
Friday, 28 June 24
INDIA'S CY23 COAL USE LARGER THAN NORTH AMERICA, EUROPE COMBINED - THE HINDU
For the first time, India’s coal consumption surpassed that of North America and Europe combined in the calendar year 2023, said Energy Insti ...
Monday, 24 June 24
PLN'S FINANCIAL SUSTAINABILITY RESTS ON ACCELERATED COAL RETIREMENT AND RENEWABLES DEPLOYMENT - MUTYA YUSTIKA
On 28 May 2024, Indonesia’s national electricity utility, PT Perusahaan Listrik Negara (PLN), released its financial report for 2023. Althoug ...
Monday, 24 June 24
INDIA'S COAL-BASED POWER DEMAND AT ALL-TIME HIGH, GOVERNMENT SAYS - REUTERS
India’s demand for coal-based power has risen by 7.3% this fiscal year to an all-time high, the government said in a statement on Wednesday.
...
Monday, 24 June 24
CHINA'S COAL INDUSTRY TURNS GREENER THROUGH INNOVATIVE APPROACHES - PEOPLE'S DAILY
At an opencast mine operated by Inner Mongolia Pingzhuang Coal Group Co. Ltd., a subsidiary of CHN Energy Investment Group (CHN Energy), a 14-meter ...
|
|
|
Showing 11 to 15 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Electricity Generating Authority of Thailand
- Posco Energy - South Korea
- Salva Resources Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Gujarat Sidhee Cement - India
- Tamil Nadu electricity Board
- Borneo Indobara - Indonesia
- Jindal Steel & Power Ltd - India
- Maheswari Brothers Coal Limited - India
- Kaltim Prima Coal - Indonesia
- Indika Energy - Indonesia
- Ministry of Mines - Canada
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PetroVietnam Power Coal Import and Supply Company
- Gujarat Mineral Development Corp Ltd - India
- Antam Resourcindo - Indonesia
- Chettinad Cement Corporation Ltd - India
- Billiton Holdings Pty Ltd - Australia
- OPG Power Generation Pvt Ltd - India
- CNBM International Corporation - China
- Bhushan Steel Limited - India
- Kobexindo Tractors - Indoneisa
- Siam City Cement PLC, Thailand
- Ind-Barath Power Infra Limited - India
- Grasim Industreis Ltd - India
- Binh Thuan Hamico - Vietnam
- SMG Consultants - Indonesia
- India Bulls Power Limited - India
- Orica Australia Pty. Ltd.
- Sarangani Energy Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Ceylon Electricity Board - Sri Lanka
- Krishnapatnam Port Company Ltd. - India
- PNOC Exploration Corporation - Philippines
- Lanco Infratech Ltd - India
- Riau Bara Harum - Indonesia
- VISA Power Limited - India
- Global Coal Blending Company Limited - Australia
- MS Steel International - UAE
- Medco Energi Mining Internasional
- Wood Mackenzie - Singapore
- Planning Commission, India
- Anglo American - United Kingdom
- Larsen & Toubro Limited - India
- Indogreen Group - Indonesia
- South Luzon Thermal Energy Corporation
- Marubeni Corporation - India
- Mercator Lines Limited - India
- Ministry of Transport, Egypt
- McConnell Dowell - Australia
- Directorate Of Revenue Intelligence - India
- Rio Tinto Coal - Australia
- Coastal Gujarat Power Limited - India
- Timah Investasi Mineral - Indoneisa
- Parry Sugars Refinery, India
- Essar Steel Hazira Ltd - India
- GAC Shipping (India) Pvt Ltd
- Pipit Mutiara Jaya. PT, Indonesia
- Edison Trading Spa - Italy
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Meralco Power Generation, Philippines
- Dalmia Cement Bharat India
- Kapuas Tunggal Persada - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Carbofer General Trading SA - India
- Leighton Contractors Pty Ltd - Australia
- Australian Commodity Traders Exchange
- Energy Development Corp, Philippines
- Independent Power Producers Association of India
- Bahari Cakrawala Sebuku - Indonesia
- ICICI Bank Limited - India
- Georgia Ports Authority, United States
- PTC India Limited - India
- Power Finance Corporation Ltd., India
- Bangladesh Power Developement Board
- Rashtriya Ispat Nigam Limited - India
- ASAPP Information Group - India
- Manunggal Multi Energi - Indonesia
- Barasentosa Lestari - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Sakthi Sugars Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Eastern Energy - Thailand
- Straits Asia Resources Limited - Singapore
- Karaikal Port Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Videocon Industries ltd - India
- Aditya Birla Group - India
- Siam City Cement - Thailand
- San Jose City I Power Corp, Philippines
- Aboitiz Power Corporation - Philippines
- Global Business Power Corporation, Philippines
- Malabar Cements Ltd - India
- Oldendorff Carriers - Singapore
- Indonesian Coal Mining Association
- Sindya Power Generating Company Private Ltd
- Thiess Contractors Indonesia
- Singapore Mercantile Exchange
- Attock Cement Pakistan Limited
- IHS Mccloskey Coal Group - USA
- Toyota Tsusho Corporation, Japan
- Miang Besar Coal Terminal - Indonesia
- Sojitz Corporation - Japan
- Goldman Sachs - Singapore
- Star Paper Mills Limited - India
- SN Aboitiz Power Inc, Philippines
- Bhatia International Limited - India
- Meenaskhi Energy Private Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Altura Mining Limited, Indonesia
- Mercuria Energy - Indonesia
- Bharathi Cement Corporation - India
- Renaissance Capital - South Africa
- AsiaOL BioFuels Corp., Philippines
- Kepco SPC Power Corporation, Philippines
- Baramulti Group, Indonesia
- New Zealand Coal & Carbon
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Eastern Coal Council - USA
- Deloitte Consulting - India
- Ambuja Cements Ltd - India
- Semirara Mining Corp, Philippines
- Commonwealth Bank - Australia
- GVK Power & Infra Limited - India
- Africa Commodities Group - South Africa
- Petron Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Vizag Seaport Private Limited - India
- Bulk Trading Sa - Switzerland
- Sree Jayajothi Cements Limited - India
- Australian Coal Association
- LBH Netherlands Bv - Netherlands
- Jaiprakash Power Ventures ltd
- Formosa Plastics Group - Taiwan
- Parliament of New Zealand
- Madhucon Powers Ltd - India
- White Energy Company Limited
- Kalimantan Lumbung Energi - Indonesia
- Xindia Steels Limited - India
- Sical Logistics Limited - India
- Global Green Power PLC Corporation, Philippines
- Agrawal Coal Company - India
- Port Waratah Coal Services - Australia
- Jorong Barutama Greston.PT - Indonesia
- European Bulk Services B.V. - Netherlands
- Banpu Public Company Limited - Thailand
- Energy Link Ltd, New Zealand
- Trasteel International SA, Italy
- Iligan Light & Power Inc, Philippines
- Wilmar Investment Holdings
- Latin American Coal - Colombia
- Minerals Council of Australia
- Neyveli Lignite Corporation Ltd, - India
- GMR Energy Limited - India
- CIMB Investment Bank - Malaysia
- Tata Chemicals Ltd - India
- Orica Mining Services - Indonesia
- Uttam Galva Steels Limited - India
- Intertek Mineral Services - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kumho Petrochemical, South Korea
- IEA Clean Coal Centre - UK
- Mjunction Services Limited - India
- Merrill Lynch Commodities Europe
- PowerSource Philippines DevCo
- London Commodity Brokers - England
- Sinarmas Energy and Mining - Indonesia
- SMC Global Power, Philippines
- Kartika Selabumi Mining - Indonesia
- Chamber of Mines of South Africa
- Bayan Resources Tbk. - Indonesia
- Central Java Power - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Pendopo Energi Batubara - Indonesia
- Bukit Makmur.PT - Indonesia
- Romanian Commodities Exchange
- The Treasury - Australian Government
- Heidelberg Cement - Germany
- Indian Energy Exchange, India
- Bukit Baiduri Energy - Indonesia
- Price Waterhouse Coopers - Russia
- Electricity Authority, New Zealand
- Thai Mozambique Logistica
- Mintek Dendrill Indonesia
- Therma Luzon, Inc, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Bhoruka Overseas - Indonesia
- Indian Oil Corporation Limited
- Makarim & Taira - Indonesia
- Cement Manufacturers Association - India
- Coalindo Energy - Indonesia
- Central Electricity Authority - India
- The University of Queensland
- Vedanta Resources Plc - India
- Asmin Koalindo Tuhup - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- The State Trading Corporation of India Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Globalindo Alam Lestari - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Metalloyd Limited - United Kingdom
- Economic Council, Georgia
- Standard Chartered Bank - UAE
- Indo Tambangraya Megah - Indonesia
- Samtan Co., Ltd - South Korea
- Alfred C Toepfer International GmbH - Germany
- Interocean Group of Companies - India
- Directorate General of MIneral and Coal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Savvy Resources Ltd - HongKong
- Coal and Oil Company - UAE
- Ministry of Finance - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Simpson Spence & Young - Indonesia
|
| |
| |
|
