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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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Friday, 04 February 11
ADARO ENERGY FY10 COAL SALES UP 6 PERCENT TO 43.84 MILLION
As reported by insider stories, Indonesian coal miners PT Adaro Energy Tbk has produced 42.20 million tons of coal in 2010, a 4 percent increase com ...
Thursday, 03 February 11
MERCATOR LINES TO INVEST RS 200-250 CRORE ON COAL MINE IN INDONESIA - ECONOMIC TIMES
Economic Times reported that, Mercator Lines, the HK Mittal-controlled shipping-to-mines major, will invest about 200-250 crore (US$ 43.825 - 54.781 ...
Thursday, 03 February 11
DRY BULK MARKET LOOKS SET TO BOTTOM OUT NIKOS - ROUSSANOGLOU, HELLENIC SHIPPING
With the dry bulk market having lost more than 72% of its value in the last month or so and having retreated to a 2-year low, it seems that the bott ...
Wednesday, 02 February 11
INDONESIA MAY MISS COAL EXPORT TARGET IN 2011
COALspot.com - Indonesian Trade ministry has instructed independent surveyors temporarily not to issue pre-shipment survey report (LS) to the compan ...
Wednesday, 02 February 11
BAYAN TO SUPPLY COAL TO TP UTILITIES LTD
Insider Stories has reportd that, Indonesia's one of the leading coal miner PT Bayan Resources Tbk (BYAN) owned by businessman Dato' Low Tuck ...
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- Ministry of Mines - Canada
- Bulk Trading Sa - Switzerland
- LBH Netherlands Bv - Netherlands
- Indian Oil Corporation Limited
- Commonwealth Bank - Australia
- Coal and Oil Company - UAE
- PNOC Exploration Corporation - Philippines
- Manunggal Multi Energi - Indonesia
- Anglo American - United Kingdom
- Price Waterhouse Coopers - Russia
- Karaikal Port Pvt Ltd - India
- Deloitte Consulting - India
- Ambuja Cements Ltd - India
- CIMB Investment Bank - Malaysia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Tamil Nadu electricity Board
- Cement Manufacturers Association - India
- The University of Queensland
- Attock Cement Pakistan Limited
- Energy Development Corp, Philippines
- Sinarmas Energy and Mining - Indonesia
- Mintek Dendrill Indonesia
- Thiess Contractors Indonesia
- Bhatia International Limited - India
- Krishnapatnam Port Company Ltd. - India
- Altura Mining Limited, Indonesia
- London Commodity Brokers - England
- Siam City Cement - Thailand
- Thai Mozambique Logistica
- Samtan Co., Ltd - South Korea
- Chamber of Mines of South Africa
- Kohat Cement Company Ltd. - Pakistan
- Global Coal Blending Company Limited - Australia
- GN Power Mariveles Coal Plant, Philippines
- The Treasury - Australian Government
- Latin American Coal - Colombia
- Global Business Power Corporation, Philippines
- Goldman Sachs - Singapore
- Sindya Power Generating Company Private Ltd
- Coastal Gujarat Power Limited - India
- Therma Luzon, Inc, Philippines
- Kumho Petrochemical, South Korea
- Wood Mackenzie - Singapore
- Cigading International Bulk Terminal - Indonesia
- Star Paper Mills Limited - India
- Indika Energy - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Billiton Holdings Pty Ltd - Australia
- Siam City Cement PLC, Thailand
- Meenaskhi Energy Private Limited - India
- Central Java Power - Indonesia
- Posco Energy - South Korea
- Bayan Resources Tbk. - Indonesia
- Ind-Barath Power Infra Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Port Waratah Coal Services - Australia
- Alfred C Toepfer International GmbH - Germany
- Simpson Spence & Young - Indonesia
- Bukit Makmur.PT - Indonesia
- Baramulti Group, Indonesia
- Eastern Energy - Thailand
- Minerals Council of Australia
- Kideco Jaya Agung - Indonesia
- VISA Power Limited - India
- Straits Asia Resources Limited - Singapore
- Mjunction Services Limited - India
- Rashtriya Ispat Nigam Limited - India
- Kobexindo Tractors - Indoneisa
- Antam Resourcindo - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Economic Council, Georgia
- Semirara Mining and Power Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Kapuas Tunggal Persada - Indonesia
- Australian Coal Association
- Neyveli Lignite Corporation Ltd, - India
- Intertek Mineral Services - Indonesia
- San Jose City I Power Corp, Philippines
- Jaiprakash Power Ventures ltd
- Bangladesh Power Developement Board
- Merrill Lynch Commodities Europe
- Maheswari Brothers Coal Limited - India
- Uttam Galva Steels Limited - India
- The State Trading Corporation of India Ltd
- Madhucon Powers Ltd - India
- Formosa Plastics Group - Taiwan
- Energy Link Ltd, New Zealand
- Renaissance Capital - South Africa
- Edison Trading Spa - Italy
- Riau Bara Harum - Indonesia
- Agrawal Coal Company - India
- Kepco SPC Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Aboitiz Power Corporation - Philippines
- Savvy Resources Ltd - HongKong
- Parliament of New Zealand
- Barasentosa Lestari - Indonesia
- Sarangani Energy Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- GAC Shipping (India) Pvt Ltd
- SMG Consultants - Indonesia
- Semirara Mining Corp, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Binh Thuan Hamico - Vietnam
- Interocean Group of Companies - India
- Sojitz Corporation - Japan
- Timah Investasi Mineral - Indoneisa
- Gujarat Electricity Regulatory Commission - India
- Bukit Asam (Persero) Tbk - Indonesia
- Kartika Selabumi Mining - Indonesia
- GVK Power & Infra Limited - India
- Power Finance Corporation Ltd., India
- Xindia Steels Limited - India
- Planning Commission, India
- Mercator Lines Limited - India
- Bukit Baiduri Energy - Indonesia
- Orica Mining Services - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Jorong Barutama Greston.PT - Indonesia
- Electricity Authority, New Zealand
- Ministry of Transport, Egypt
- Gujarat Mineral Development Corp Ltd - India
- OPG Power Generation Pvt Ltd - India
- White Energy Company Limited
- Miang Besar Coal Terminal - Indonesia
- Electricity Generating Authority of Thailand
- Romanian Commodities Exchange
- Directorate Of Revenue Intelligence - India
- Kaltim Prima Coal - Indonesia
- Iligan Light & Power Inc, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Makarim & Taira - Indonesia
- ICICI Bank Limited - India
- Essar Steel Hazira Ltd - India
- Vedanta Resources Plc - India
- Asmin Koalindo Tuhup - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Indian Energy Exchange, India
- Bhoruka Overseas - Indonesia
- SN Aboitiz Power Inc, Philippines
- PTC India Limited - India
- Grasim Industreis Ltd - India
- Bhushan Steel Limited - India
- Orica Australia Pty. Ltd.
- Carbofer General Trading SA - India
- Sakthi Sugars Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Tata Chemicals Ltd - India
- Africa Commodities Group - South Africa
- Borneo Indobara - Indonesia
- Eastern Coal Council - USA
- Leighton Contractors Pty Ltd - Australia
- Chettinad Cement Corporation Ltd - India
- McConnell Dowell - Australia
- New Zealand Coal & Carbon
- Central Electricity Authority - India
- Metalloyd Limited - United Kingdom
- CNBM International Corporation - China
- SMC Global Power, Philippines
- Meralco Power Generation, Philippines
- Lanco Infratech Ltd - India
- Global Green Power PLC Corporation, Philippines
- ASAPP Information Group - India
- Malabar Cements Ltd - India
- MS Steel International - UAE
- Coalindo Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Gujarat Sidhee Cement - India
- Wilmar Investment Holdings
- Australian Commodity Traders Exchange
- Ministry of Finance - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Mercuria Energy - Indonesia
- Rio Tinto Coal - Australia
- Heidelberg Cement - Germany
- IEA Clean Coal Centre - UK
- IHS Mccloskey Coal Group - USA
- Kalimantan Lumbung Energi - Indonesia
- Jindal Steel & Power Ltd - India
- International Coal Ventures Pvt Ltd - India
- Videocon Industries ltd - India
- Larsen & Toubro Limited - India
- Globalindo Alam Lestari - Indonesia
- India Bulls Power Limited - India
- Petron Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- South Luzon Thermal Energy Corporation
- Sree Jayajothi Cements Limited - India
- Singapore Mercantile Exchange
- Indo Tambangraya Megah - Indonesia
- Medco Energi Mining Internasional
- Parry Sugars Refinery, India
- Trasteel International SA, Italy
- TeaM Sual Corporation - Philippines
- Standard Chartered Bank - UAE
- Holcim Trading Pte Ltd - Singapore
- Georgia Ports Authority, United States
- TNB Fuel Sdn Bhd - Malaysia
- Aditya Birla Group - India
- Sical Logistics Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Independent Power Producers Association of India
- Banpu Public Company Limited - Thailand
- Vijayanagar Sugar Pvt Ltd - India
- Indogreen Group - Indonesia
- Dalmia Cement Bharat India
- Indonesian Coal Mining Association
- Salva Resources Pvt Ltd - India
- PowerSource Philippines DevCo
- Toyota Tsusho Corporation, Japan
- Marubeni Corporation - India
- GMR Energy Limited - India
- Oldendorff Carriers - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Bharathi Cement Corporation - India
- Ceylon Electricity Board - Sri Lanka
- Vizag Seaport Private Limited - India
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