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Monday, 07 February 11
COAL PRICES ON RISE: DEMAND FROM INDIA AND CHINA - ANALYZED SUNIL K KUMBHAT
 INDONESIA IS HEART OF ASIAN COAL BOOM
COALspot.com - Rising demand of Coal from India and China, coupled with global financial recovery, is driving thermal coal prices that have appreciated in the recent past few months and it is expected that the global prices of Coal shall remain firm and go up further.
Power generation is what is driving the demand of Coal in India and China . In India new coal-fired power plants, ranging in the size from 50 MW to 4,000 MW, are being built throughout India. Power plants are symbol of how rapidly India's economy is expanding.
Similarly China, shall remain a net importer of thermal coal for coming few years as it's economy is growing at firm speed and is expected to deliver mind-boggling growth in 2011. China's coal imports more than doubled to 150 million tonnes from the previous year. Closure of smaller mines, coupled with increased demand from power sector, has triggered China's demand for imported coal.
India has also emerged as one of the major importer of coal. The imports are likely to be around 100-150 million tonnes for the current year as it adds new thermal capacities. India imports about three-fourths of its coal requirement from Indonesia, while South Africa and Australia accounts for the rest.
The quality of Indonesian coal is much better than Indian coal. The gross calorific value of Indonesian coal ranges between 5,000 and 6,500 kilo calories per kilogram (kcl/kg); while for Indian coal it is only 3,000-4,500 kcl/kg- with high ash contents. Bulk of the imported coal in India is used by power companies, which use it to blend with the local coal to improve calorific value. The coal prices also depend upon the ash content and the calorific value .Indonesia’s strategic geographic location makes it the most preferred country for Indian companies for its proximity to the country, which means lower ocean freight charges and better timing compared to other countries such as Australia.
Indonesia's coal Industry has transformed itself from being an minor player in Asia's Coal market to the world's largest Exporter of Steam Coal .Indonesia has come from nowhere to challenge Australia as the world’s largest exporter of thermal coal and is expected soon to topple Australia as the largest coal exporter.
The higher energy demand in India would drive up import of coal .The overall energy generated in India could double within a decade.
Indian power sector will be heavily depend on coal for decades to come. At the same time, India's steel industry, also dependent on coal, is expected to treble its output within a decade.
But there is growing concern about where all the coal is going to come from. India has significant coal reserves suitable for power generation and boasts the world's biggest coal company - the government-owned Coal India Limited. But the expansion of the Indian economy has been so rapid, demand is outstripping domestic supply.
The government wants the economy to expand at 9-10 per cent a year to help lift millions of poor families out of poverty. But an energy supply crunch could compromise that growth target.
India has theoretically significant reserves but it will take a long time to get into actual production, There is a urgent need to re-examine the regulations and policies associated with exploration, exploitation and production. India is still not fully encouraging commercial coal mining by the private sector.
India's coal reserves are concentrated in the eastern states of Orissa, Jharkhand, Chhattisgarh, West Bengal and Madhya Pradesh, where basic logistics infrastructure (such as ports and railways) is lacking. Various government regulation concerning forestry and environmental restrictions are also hindering mine development. Unless such bottlenecks are addressed, growth in domestic coal production could be difficult.'
Due to government regulatory delays, infrastructure bottlenecks and security risks are encouraging Indian firms to look overseas to secure coal supply especially in Indonesia, South Africa, Mozambique, Australia etc. for their ambitious power projects in India.
Indonesia's thermal coal mines have a comparative advantage over Australia's because they are nearer to India but Australia's reputation as a reliable supplier is attractive to Indian buyers.’ Australian mines might be more expensive but they are reliable. Australia’s advantages are that the coal is good and the infrastructure is good'
In spit of all , Australia will face stiff competition from Indonesia - which has lower transport costs. A significant proportion of coal transport in Indonesia is water based, which allows for coal to be transported along rivers via barges to the open sea for loading onto larger vessels. Indonesia’s coal suppliers rely heavily on floating transhipment facilities due to economic reasons.
Indonesia's coal Industry has transformed itself from being an minor player in Asia's Coal market to the world's largest Exporter of Steam Coal .Indonesia has come from nowhere to challenge Australia as the world’s largest exporter of thermal coal and is expected soon to topple Australia as the largest coal exporter.
Indonesia’s government needs to accelerate reforms for foreign direct investment (FDI) in mining and energy sector to give direct control to foreign investors, in order to win confidence and attract/invite major international companies into Indonesia. There is need of more coordination between Ministry of Energy and Mineral Resources Deptt , Indonesian Investment Co-ordination Board (BKPM) ,and Various Regional administrations.
The phenomenal growth in Indonesia’s coal exports in last five years reflects the ability of its coal industry to respond to the rapid growth in Asian demand for thermal coal.
Indonesia has huge coal reserves and exporting coal to many countries for use in power plants for generating energy but it is paradoxical that Indonesia is short of energy. Many Indian companies (Tata , Reliance,Jindal ,L&T, Monnet, Adani ,Essar etc) are capable of sharing power technology and setting up mega power plants in Indonesia
Indonesian private companies can buy equity stakes in Indian power plants in exchange / barter for long-term coal supply. Since India is today one of the fastest growing economies and also has a shortage of power supply then such deals can be beneficial to both parties .Indonesian government or Indonesian companies can invite Coal barter bids (CBB) ,where from foreign companies for development of ports , Roads , Railway lines , Power Plants etc. In Coal barter bids , coal will be supplied to party who will set up Power plants or develop infrastructure etc. Coal mining in Indonesia can be an extremely lucrative sector for overall economic growth. Indonesian government should make single window clearance system to operate business in Indonesia to encourage foreign enterprises and Investment for Coal barter bids. Indonesian Coal companies are fully aware that India is a market into which they can export or thru barter transactions, its major share of Coal Production.
Today Indonesia has stable economic outlook and if reform efforts towards basic infrastructures continues it may become Economic Tiger of Asia by 2020.
Today Indonesia is the heart of the Asian Coal boom.
Analyst - Sunil K Kumbhat , Jodhpur (Rajasthan), India
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Tuesday, 08 February 11
PUSTAKA JAYA PALU POWER LOOKING FOR 5800 GAD COAL
COALspot.com - According to market information, PT Pustaka Jaya Palu Power, a power plant operator of the Mpanau plant, Palu, Sulawesi has invited c ...
Tuesday, 08 February 11
BAYAN, KANGAROO EXTEND DUE DILIGENCE
Coal miner controlled by businessman Dato' Low Tuck Kwong PT Bayan Resources Tbk (BYAN) and Australia-listed coal company Kangaroo Resources Limite ...
Tuesday, 08 February 11
DRY BULK: IS THE TIDE TURNING? - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
In what could be perceived as a change of market sentiment for the better, the dry bulk industry’s benchmark, the Baltic Dry Index (BDI) poste ...
Monday, 07 February 11
THE INDONESIAN COAL REFERENCE PRICE HAS JUMPED 13.03 PERCENT IN FEBRUARY 2011
COALspot.com - Indonesia’s Ministry of Energy and Mineral Resources has set the February 2011 Indonesian Coal Reference Price for therma ...
Monday, 07 February 11
RICHARDS BAY COAL TERMINAL EXPORTS SURGE, BUOYED BY ECONOMIC DEVELOPMENT IN CHINA AND INDIA
COALspot.com - Richards Bay Coal Terminal (RBCT) announced today that 2010 exports have exceeded the last two years’ performance, said in a re ...
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- Billiton Holdings Pty Ltd - Australia
- Mintek Dendrill Indonesia
- Thai Mozambique Logistica
- PowerSource Philippines DevCo
- Orica Mining Services - Indonesia
- Bukit Baiduri Energy - Indonesia
- India Bulls Power Limited - India
- PTC India Limited - India
- MS Steel International - UAE
- Oldendorff Carriers - Singapore
- Alfred C Toepfer International GmbH - Germany
- Kepco SPC Power Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Manunggal Multi Energi - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jindal Steel & Power Ltd - India
- London Commodity Brokers - England
- Indian Oil Corporation Limited
- Makarim & Taira - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Power Finance Corporation Ltd., India
- Meralco Power Generation, Philippines
- ASAPP Information Group - India
- Anglo American - United Kingdom
- Dalmia Cement Bharat India
- Grasim Industreis Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Global Green Power PLC Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- Edison Trading Spa - Italy
- Larsen & Toubro Limited - India
- Sarangani Energy Corporation, Philippines
- SMG Consultants - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- GAC Shipping (India) Pvt Ltd
- Therma Luzon, Inc, Philippines
- International Coal Ventures Pvt Ltd - India
- Merrill Lynch Commodities Europe
- PetroVietnam Power Coal Import and Supply Company
- Rashtriya Ispat Nigam Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Tamil Nadu electricity Board
- Uttam Galva Steels Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Asmin Koalindo Tuhup - Indonesia
- Cement Manufacturers Association - India
- Madhucon Powers Ltd - India
- Sojitz Corporation - Japan
- Intertek Mineral Services - Indonesia
- Mercuria Energy - Indonesia
- Banpu Public Company Limited - Thailand
- Kartika Selabumi Mining - Indonesia
- Gujarat Sidhee Cement - India
- Savvy Resources Ltd - HongKong
- Energy Development Corp, Philippines
- Bangladesh Power Developement Board
- Kapuas Tunggal Persada - Indonesia
- Port Waratah Coal Services - Australia
- European Bulk Services B.V. - Netherlands
- Ceylon Electricity Board - Sri Lanka
- Africa Commodities Group - South Africa
- Sakthi Sugars Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Sree Jayajothi Cements Limited - India
- Planning Commission, India
- Neyveli Lignite Corporation Ltd, - India
- Lanco Infratech Ltd - India
- Medco Energi Mining Internasional
- Bayan Resources Tbk. - Indonesia
- Global Coal Blending Company Limited - Australia
- Malabar Cements Ltd - India
- Economic Council, Georgia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Minerals Council of Australia
- Straits Asia Resources Limited - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Central Electricity Authority - India
- Meenaskhi Energy Private Limited - India
- OPG Power Generation Pvt Ltd - India
- Ambuja Cements Ltd - India
- Bhoruka Overseas - Indonesia
- The University of Queensland
- AsiaOL BioFuels Corp., Philippines
- Global Business Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Vizag Seaport Private Limited - India
- Bhushan Steel Limited - India
- Antam Resourcindo - Indonesia
- San Jose City I Power Corp, Philippines
- Wood Mackenzie - Singapore
- Indika Energy - Indonesia
- Commonwealth Bank - Australia
- Parliament of New Zealand
- SMC Global Power, Philippines
- GVK Power & Infra Limited - India
- Siam City Cement PLC, Thailand
- Electricity Authority, New Zealand
- Energy Link Ltd, New Zealand
- Kumho Petrochemical, South Korea
- Singapore Mercantile Exchange
- Independent Power Producers Association of India
- Petrochimia International Co. Ltd.- Taiwan
- Karaikal Port Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Ministry of Transport, Egypt
- GN Power Mariveles Coal Plant, Philippines
- Jaiprakash Power Ventures ltd
- South Luzon Thermal Energy Corporation
- Renaissance Capital - South Africa
- Latin American Coal - Colombia
- ICICI Bank Limited - India
- TeaM Sual Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- CNBM International Corporation - China
- Kobexindo Tractors - Indoneisa
- Karbindo Abesyapradhi - Indoneisa
- Chettinad Cement Corporation Ltd - India
- Eastern Energy - Thailand
- Indian Energy Exchange, India
- Aboitiz Power Corporation - Philippines
- Kalimantan Lumbung Energi - Indonesia
- PNOC Exploration Corporation - Philippines
- Xindia Steels Limited - India
- Price Waterhouse Coopers - Russia
- Leighton Contractors Pty Ltd - Australia
- Orica Australia Pty. Ltd.
- LBH Netherlands Bv - Netherlands
- Kaltim Prima Coal - Indonesia
- Toyota Tsusho Corporation, Japan
- Ministry of Mines - Canada
- The Treasury - Australian Government
- Ind-Barath Power Infra Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Samtan Co., Ltd - South Korea
- Mercator Lines Limited - India
- Georgia Ports Authority, United States
- Cigading International Bulk Terminal - Indonesia
- Trasteel International SA, Italy
- CIMB Investment Bank - Malaysia
- Standard Chartered Bank - UAE
- Kideco Jaya Agung - Indonesia
- Vedanta Resources Plc - India
- The State Trading Corporation of India Ltd
- Indonesian Coal Mining Association
- Star Paper Mills Limited - India
- Coal and Oil Company - UAE
- Binh Thuan Hamico - Vietnam
- Rio Tinto Coal - Australia
- Ministry of Finance - Indonesia
- Marubeni Corporation - India
- Gujarat Mineral Development Corp Ltd - India
- Coastal Gujarat Power Limited - India
- SN Aboitiz Power Inc, Philippines
- Australian Commodity Traders Exchange
- Semirara Mining Corp, Philippines
- Sindya Power Generating Company Private Ltd
- Indogreen Group - Indonesia
- Mjunction Services Limited - India
- Salva Resources Pvt Ltd - India
- Deloitte Consulting - India
- Simpson Spence & Young - Indonesia
- Bhatia International Limited - India
- Videocon Industries ltd - India
- Barasentosa Lestari - Indonesia
- Central Java Power - Indonesia
- Thiess Contractors Indonesia
- Pendopo Energi Batubara - Indonesia
- IEA Clean Coal Centre - UK
- Interocean Group of Companies - India
- Bulk Trading Sa - Switzerland
- Riau Bara Harum - Indonesia
- Aditya Birla Group - India
- Agrawal Coal Company - India
- Romanian Commodities Exchange
- Eastern Coal Council - USA
- Bharathi Cement Corporation - India
- Attock Cement Pakistan Limited
- Vijayanagar Sugar Pvt Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Parry Sugars Refinery, India
- Chamber of Mines of South Africa
- Bukit Makmur.PT - Indonesia
- Electricity Generating Authority of Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- Indo Tambangraya Megah - Indonesia
- Australian Coal Association
- Coalindo Energy - Indonesia
- Wilmar Investment Holdings
- Tata Chemicals Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Goldman Sachs - Singapore
- Altura Mining Limited, Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Petron Corporation, Philippines
- Formosa Plastics Group - Taiwan
- Sical Logistics Limited - India
- Metalloyd Limited - United Kingdom
- Borneo Indobara - Indonesia
- GMR Energy Limited - India
- Siam City Cement - Thailand
- Holcim Trading Pte Ltd - Singapore
- McConnell Dowell - Australia
- White Energy Company Limited
- VISA Power Limited - India
- Iligan Light & Power Inc, Philippines
- Heidelberg Cement - Germany
- Essar Steel Hazira Ltd - India
- New Zealand Coal & Carbon
- Baramulti Group, Indonesia
- Carbofer General Trading SA - India
- IHS Mccloskey Coal Group - USA
- Timah Investasi Mineral - Indoneisa
- Posco Energy - South Korea
- Maheswari Brothers Coal Limited - India
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