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Wednesday, 13 June 12
LOW COAL PRICES COULD CHANGE SUPPLY SIDE DYNAMICS - FITCH RATINGS
 Fitch Ratings believes that the weakness seen in thermal coal prices in recent months should reverse once demand from major importers recovers, although there is a risk low prices may persist into 2013, changing the industry's supply side dynamics.
The price of thermal coal (5,500 kcal coal at Newcastle Australia on a free-on-board basis) reached a two-year low of USD87 per metric ton in early June 2012, down from USD142/mt in January 2011. Major reasons for this decline include China's economic slowdown and high coal inventory levels, increased production and exports from Indonesia and Australia, and increased exports by US coal producers due to cheap natural gas displacing coal used in US power generation.
Fitch believes that prices can recover from current lows once demand from key importers - China and India - improves, and the supply side adjusts to reflect the price environment. India depends on coal as its major energy source and is increasingly relying on imported coal as it struggles to increase domestic production. Likewise in China, thermal coal fired power represents more than 70% of the country's energy needs; Fitch believes thermal coal demand from China will lift again post sufficient policy easing by the government, and continue rising over the medium-to-long term in line with the country's strong GDP growth outlook, albeit lower than previous years.
The weak pricing environment is exposing the business risks of high-cost coal producers, as coal prices fall near or below the marginal cost of production. Many Australian producers have high cash costs of production; such operators will be significantly affected if prices remain low for an extended period. At the same time, sustained low coal prices can shift buyers from low-rank coal to higher-grade coals and thus negatively affect both demand and realized prices for low-rank coal.
Fitch notes that many large coal producers have contracts in place with both volumes and prices fixed, typically for a period of one year; such contracts can account for a meaningful share of their total revenues - for example around 65% for Adaro Indonesia ('BB+'/Stable) and around 45% PT Indika Energy ('B+'/Positive). These operators would be insulated from a temporary weakening of coal prices to some extent. However, should low prices persist through 2012 and into 2013, it will negatively affect the prices they negotiate for 2013; such negotiations typically take place in Q4 and Q1 of each calendar year.
Should the current low price environment persist into 2013, Fitch expects high-cost producers in Australia and the US to undertake production cuts, and review expansion projects under consideration. Fitch also believes that production expansion plans by low-cost producing countries like Indonesia may be curtailed. Such actions would limit coal production levels (or growth) and help address oversupply.
In rating companies producing commodities, like coal, Fitch takes a through-the-cycle approach to its ratings; this factors in a reasonable level of rating headroom to accommodate weakening of coal prices. Cash cost of production and cash margins over an industry cycle are given a heavy emphasis and factored into the ratings. Hence, Fitch does not expect any immediate negative rating actions on its rated coal producers in the Asia-Pacific region.
Source: Fitch Ratings
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Sunday, 15 April 12
THE SPOT FIXTURE RATES FOR SUPRAMAX IN SE ASIA SAW SOME SOFTENING OF CHARTER RATES - VISTAAR
COALspot.com - The market seem to be holding and except for Supramax and handy size index all other index was up with BDI up by 4.74 pct closing at ...
Friday, 13 April 12
MINERS OPPOSE GOVTS EXPORT TAX PLAN - THE JAKARTA POST
The Jakarta Post reported that, Indonesian mining companies have strongly protested the government’s plan to impose a 25 percent export tax on ...
Friday, 13 April 12
S&P CAUTIONS AGAINST NEW INDONESIAN MINING REGULATIONS - THE JAKARTA GLOBE
The Jakarta Globe reported that, Investors may have expressed concerns about looming new mining regulations, but ratings agency Standard & Poor& ...
Thursday, 12 April 12
FIRST QUARTER OF 2012 SAW AN ADDITIONAL 24.2 MILLION DWT OF DRY BULK CARRIERS ENTERING THE FLEET - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The inflow of newbuilt dry bulk vessels was larger than expected in the first quarter of 2012. As much as 24.2 million DWT were added to the fleet. ...
Wednesday, 11 April 12
TWO PERCENT OF IBP CONCESSION CONTAINS 42 MMT OF COAL
COALspot.com - 42.35 million ton of coal found in just 2% of PT Insani Bara Perkasa’s total concession area of 24,477 hectare.
Accord ...
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- AsiaOL BioFuels Corp., Philippines
- Siam City Cement PLC, Thailand
- TeaM Sual Corporation - Philippines
- Agrawal Coal Company - India
- Alfred C Toepfer International GmbH - Germany
- GVK Power & Infra Limited - India
- Chamber of Mines of South Africa
- Bhatia International Limited - India
- Indogreen Group - Indonesia
- Barasentosa Lestari - Indonesia
- Energy Development Corp, Philippines
- The University of Queensland
- GMR Energy Limited - India
- Star Paper Mills Limited - India
- Bukit Baiduri Energy - Indonesia
- Global Business Power Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- South Luzon Thermal Energy Corporation
- Binh Thuan Hamico - Vietnam
- Ministry of Mines - Canada
- Kartika Selabumi Mining - Indonesia
- Videocon Industries ltd - India
- Posco Energy - South Korea
- Indian Energy Exchange, India
- Miang Besar Coal Terminal - Indonesia
- Baramulti Group, Indonesia
- Wilmar Investment Holdings
- Sarangani Energy Corporation, Philippines
- New Zealand Coal & Carbon
- PTC India Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Eastern Energy - Thailand
- Carbofer General Trading SA - India
- European Bulk Services B.V. - Netherlands
- Timah Investasi Mineral - Indoneisa
- Eastern Coal Council - USA
- Gujarat Mineral Development Corp Ltd - India
- Larsen & Toubro Limited - India
- Therma Luzon, Inc, Philippines
- Jindal Steel & Power Ltd - India
- Kobexindo Tractors - Indoneisa
- Kepco SPC Power Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Madhucon Powers Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Standard Chartered Bank - UAE
- ASAPP Information Group - India
- Australian Commodity Traders Exchange
- Interocean Group of Companies - India
- Karaikal Port Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Vizag Seaport Private Limited - India
- Aditya Birla Group - India
- Petron Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Edison Trading Spa - Italy
- Samtan Co., Ltd - South Korea
- Meralco Power Generation, Philippines
- Vedanta Resources Plc - India
- Tata Chemicals Ltd - India
- Makarim & Taira - Indonesia
- Sical Logistics Limited - India
- Kideco Jaya Agung - Indonesia
- Ministry of Transport, Egypt
- Price Waterhouse Coopers - Russia
- Central Java Power - Indonesia
- Iligan Light & Power Inc, Philippines
- ICICI Bank Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sindya Power Generating Company Private Ltd
- Central Electricity Authority - India
- McConnell Dowell - Australia
- Rashtriya Ispat Nigam Limited - India
- Global Coal Blending Company Limited - Australia
- Medco Energi Mining Internasional
- Thai Mozambique Logistica
- Coastal Gujarat Power Limited - India
- Energy Link Ltd, New Zealand
- Metalloyd Limited - United Kingdom
- Krishnapatnam Port Company Ltd. - India
- Kumho Petrochemical, South Korea
- Planning Commission, India
- Borneo Indobara - Indonesia
- Electricity Generating Authority of Thailand
- Gujarat Electricity Regulatory Commission - India
- Pipit Mutiara Jaya. PT, Indonesia
- Port Waratah Coal Services - Australia
- IEA Clean Coal Centre - UK
- India Bulls Power Limited - India
- Wood Mackenzie - Singapore
- Gujarat Sidhee Cement - India
- Orica Mining Services - Indonesia
- Formosa Plastics Group - Taiwan
- MS Steel International - UAE
- Siam City Cement - Thailand
- Indonesian Coal Mining Association
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bahari Cakrawala Sebuku - Indonesia
- Indika Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Bulk Trading Sa - Switzerland
- Jorong Barutama Greston.PT - Indonesia
- Savvy Resources Ltd - HongKong
- Attock Cement Pakistan Limited
- Chettinad Cement Corporation Ltd - India
- Power Finance Corporation Ltd., India
- Neyveli Lignite Corporation Ltd, - India
- SMG Consultants - Indonesia
- SN Aboitiz Power Inc, Philippines
- Xindia Steels Limited - India
- Oldendorff Carriers - Singapore
- Australian Coal Association
- Altura Mining Limited, Indonesia
- Trasteel International SA, Italy
- Kohat Cement Company Ltd. - Pakistan
- Billiton Holdings Pty Ltd - Australia
- Salva Resources Pvt Ltd - India
- Cement Manufacturers Association - India
- Economic Council, Georgia
- Coalindo Energy - Indonesia
- Heidelberg Cement - Germany
- Ceylon Electricity Board - Sri Lanka
- Parliament of New Zealand
- Romanian Commodities Exchange
- Vijayanagar Sugar Pvt Ltd - India
- White Energy Company Limited
- Thiess Contractors Indonesia
- PowerSource Philippines DevCo
- Mintek Dendrill Indonesia
- Merrill Lynch Commodities Europe
- Essar Steel Hazira Ltd - India
- Bhushan Steel Limited - India
- IHS Mccloskey Coal Group - USA
- Indo Tambangraya Megah - Indonesia
- Intertek Mineral Services - Indonesia
- Semirara Mining and Power Corporation, Philippines
- The Treasury - Australian Government
- Singapore Mercantile Exchange
- SMC Global Power, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mjunction Services Limited - India
- Lanco Infratech Ltd - India
- Dalmia Cement Bharat India
- Banpu Public Company Limited - Thailand
- LBH Netherlands Bv - Netherlands
- Renaissance Capital - South Africa
- VISA Power Limited - India
- Manunggal Multi Energi - Indonesia
- CIMB Investment Bank - Malaysia
- Tamil Nadu electricity Board
- Coal and Oil Company - UAE
- Straits Asia Resources Limited - Singapore
- Antam Resourcindo - Indonesia
- Electricity Authority, New Zealand
- CNBM International Corporation - China
- Maheswari Brothers Coal Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Africa Commodities Group - South Africa
- Bangladesh Power Developement Board
- London Commodity Brokers - England
- Pendopo Energi Batubara - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Meenaskhi Energy Private Limited - India
- Bhoruka Overseas - Indonesia
- Grasim Industreis Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Commonwealth Bank - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Mercator Lines Limited - India
- GAC Shipping (India) Pvt Ltd
- Aboitiz Power Corporation - Philippines
- Ministry of Finance - Indonesia
- Anglo American - United Kingdom
- Bharathi Cement Corporation - India
- Deloitte Consulting - India
- Directorate Of Revenue Intelligence - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kaltim Prima Coal - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Bukit Makmur.PT - Indonesia
- Simpson Spence & Young - Indonesia
- Independent Power Producers Association of India
- Latin American Coal - Colombia
- TNB Fuel Sdn Bhd - Malaysia
- Parry Sugars Refinery, India
- Rio Tinto Coal - Australia
- PNOC Exploration Corporation - Philippines
- Jaiprakash Power Ventures ltd
- Goldman Sachs - Singapore
- OPG Power Generation Pvt Ltd - India
- Marubeni Corporation - India
- PetroVietnam Power Coal Import and Supply Company
- Global Green Power PLC Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Sojitz Corporation - Japan
- Orica Australia Pty. Ltd.
- Bukit Asam (Persero) Tbk - Indonesia
- The State Trading Corporation of India Ltd
- Ambuja Cements Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Sakthi Sugars Limited - India
- Malabar Cements Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indian Oil Corporation Limited
- Minerals Council of Australia
- Semirara Mining Corp, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Riau Bara Harum - Indonesia
- San Jose City I Power Corp, Philippines
- Georgia Ports Authority, United States
- Mercuria Energy - Indonesia
- Toyota Tsusho Corporation, Japan
- Globalindo Alam Lestari - Indonesia
- Uttam Galva Steels Limited - India
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