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Thursday, 27 June 13
US COAL EXPORTS BEATS CHINESE COAL IMPORTS AS THE MOST INFLUENTIAL COAL TRADE - BIMCO
 The influence of American coal exports on seaborne transportation has grown significantly over the past decade. In 2002, the US exported 20.1 million tons by sea, but in 2012 that number had increased to 106.7 million tons. The effect on shipping has multiplied due to the fact that much of the demand growth has come from East Asian countries. With a large part of the US Coal destined for East Asia being shipping out of the US East Coast ports, this will increase the demand for tonnage.
Chief Shipping Analyst at BIMCO, Peter Sand, says: “As a consequence, the transportation demand stemming from US coal exports has surged from 84.7 billion tonne-miles in 2002 to an estimated 707.3 billion tonne-miles in 2012 (835% over the period). In comparison, the Chinese coal imports in 2012 accounted for an estimated 697.6 billion tonne-miles of demand for seaborne transportation. This means the US coal exports was more important to the dry bulk shipping market than the Chinese coal imports in 2012”.
Dissection of the US coal exports
The US exported 22.0 million tons of coal to the East Asian countries of South Korea, Japan and China in 2012, of which 5.1 million tons came from Pacific ports. The Pacific ports export thermal coal to East Asia, while the US East coast and Gulf coast (USEC/USGC) ports export both thermal coal and coking coal. Of the total 22.0 million tons exported to East Asia in 2012, coking coal made up 14.9 million tons (68%) and thermal coal made up 7.1 million tons (32%). 40% of the coal exported to East Asia came from Baltimore, a Capesize-accommodating port that attracts Asian buyers, who also has to accept an extended distance of more than 14,000 nautical miles to reach the port of discharge. Likewise, the US exported 51.3 million tons of coal to the EU in 2012. The main destinations were the Netherlands and the UK with a total of 23.1 million tons. A part of the coal exports to the Netherlands are subsequently transhipped to German buyers. Traditionally, most of the European trade has been for coking coal, but 2012 marked the year where this pattern changed. In 2012, the US exported 27.9 million tons of thermal coal to the EU (54%), but only 23.4 million tons of coking coal (46%). Unlike the exports going to East Asia, all coal exports to Europe came from USEC/USGC ports making the transit distances substantially shorter. The result is that the exports to East Asia are more beneficial for the shipping industry than the exports to the European Union, despite involving much lower volumes.
Thermal coal exports – Reflecting a new energy market in the US
The increased thermal coal exports is explained by the large-scale exploitation of unconventional fuels in the US, which has made consumption of domestic oil and gas relatively cheaper. The average Brent-WTI spread went from nothing to around USD 17 per barrel during 2011 and 2012, while domestic US natural gas prices have halved since mid-2000s.
As a consequence, the domestic consumption of coal fell by 11% to 807.8 million tons in 2012. Since the production only fell by 7.2% to 922.1 million tons, the potential for exports has increased. Meanwhile, European gas-driven power plants suffer from oil-indexed contracts and higher oil prices, making coal the cheapest option for energy in Europe. Working in the same direction was the “collapsing” carbon prices within the EU ETS which only made the appetite for coal more significant. “Back loading” or not in the EU ETS, this is probably going to be the case also in the coming years. The low freight rates during the past two years have also been an incentive for importing coal from countries far away such as the US and Colombia. The thermal coal to East Asia is primarily shipped to South Korea, who has virtually no coal mining industry. The increased South Korean demand for US coal originates from a desire to diversify trading partners to manage rising coal costs.
Coking coal exports – a matter of Chinese steel production
Coking coal demand in East Asia has largely been a result of an increased Chinese steel production. The Chinese steel output in 2012 was four times larger than in 2002, while the production in Japan and South Korea has remained relatively unchanged. As a consequence, China has increased its imports of coking coal, which has benefitted the US as well.
South Korea has traditionally imported coking coal from Australia, Canada and China. However, due to the Chinese domestic demand, South Korean steel mills have to source their coal elsewhere than China, which has benefitted exporting countries such as the US and Russia. Japan has imported less coking coal post-2008, but the country has increased its coking coal imports from the US as a substitute for Australian coking coal, which means that the distances travelled increase fourfold.
In the EU, seaborne coking coal demand has been relatively stable over the last decade, but a larger share is being sourced from the US. In 2002, the US exported 9.9 million tons to the European Union; in 2012, the number had increased to 23.4 million tons. The increased demand for coking coal came from Germany and the Netherlands in particular, but also from Italy, France and the UK. Outlook Looking forward, India could become a medium-term growth factor as the country has experienced very high demand growth for US coal during the past five years. The US exported 6.4 million tons to India in 2012 – all shipped from USEC/USGC ports. Back in the US there are talks about building a large coal export terminal at Cherry Point, state of Washington or in the state of Oregon. One proposal, at Cherry Point near the Canadian border on the West Coast, plans to have a capacity of 48 million tons per year. The terminals would accommodate the large thermal coal reserves in Montana and Wyoming. Out of the 431.1 million tons of thermal coal produced in 2011 in these states, only 15.5 million tons were exported (source: EIA). The terminals are being built to meet the increasing demand for coal-fired power generation in East Asia, and at full capacity, the Cherry Point terminal would create employment for 40 Capesize vessels on an annualised basis. We expect to see a surge in exports if the terminals are built. US thermal coal exports to East Asia in April were slightly up from the same month last year (8%), but down by 24% from the month before which represented an all-time-high in total coal exports. Coking coal is more of a joker, as the April numbers throw a wet blanket over the party. Coking coal exports to East Asia were substantially down from the same month last year (-40%) as well as from last month (-44%). Sources attribute this to lower GDP growth in China combined with a massive oversupply of coal in East Asia. Some analysts therefore expect US coal exports to be 10-15% lower this year compared to last year.
Another potential threat comes from the talks of a Chinese ban on high-sulphur and low-calorific coal, as much of the US coal going to China has a high content of sulphur. In 2012, China imported 8 million tons of coal with sulphur content above 1%. It is however uncertain if Beijing will ratify the coal ban. However the US has lots of low sulphur coal reserves to substitute the high sulphur coal if it is demanded.
“When we look into the future, global demand for thermal and coking coal is set for solid growth with thermal coal being in the driving seat both in terms of volume and percentage growth. If the US can stay price competitive in the market and scale up Pacific port capacity, the longer sailing distances are likely to benefit dry bulk shipping demand along the road” adds Peter Sand.
Source: BIMCO / Hellenic Shipping News
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Wednesday, 11 September 13
ASIA - PACIFIC THERMAL COAL MARKET TO REMAIN OVERSUPPLIED IN NEXT 12 MONTHS - FITCH RATINGS
COALspot.com: Fitch Ratings says the Asia-Pacific thermal coal market will remain oversupplied in the next 12 months because strong production has b ...
Tuesday, 10 September 13
COAL EXPORTS AT AUSTRALIA'S NEWCASTLE PORT SLIP 30.31% ON WEEK TO 2.36 MMT
COALspot.com: Power plant and semi-soft coking coal shipments from Australia's Newcastle port down 30.31 per cent week on week to 2.36 million mt f ...
Tuesday, 10 September 13
WORLDWIDE COAL CONSUMPTION RISES SHARPLY - RA DR. ERICH SCHMITZ
By: RA Dr. Erich Schmitz, Verein der Kohlenimporteure (Germany Coal Importers Association)
World hard coal market in the first half of 2013: worl ...
Monday, 09 September 13
REBOUND IN NEWBUILDING ORDERS HASN'T HURT DRY BULK MARKET PROSPECTS, BUT SHIP OWNERS SHOULD STILL BE CAUTIOUS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Since the start of 2013 and up until the end of August, one thing has really caught the headlines in the dry bulk market, except of course, the frei ...
Sunday, 08 September 13
Q3 2014 THERMAL COAL SWAPS : STEADY DIRECTION
COALspot.com – Sub-Bit Indonesia coal swap (FOB ) for average Q4 2013 delivery up 1.88 percent month on month. The swap was moved ...
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- LBH Netherlands Bv - Netherlands
- Commonwealth Bank - Australia
- Directorate General of MIneral and Coal - Indonesia
- Sindya Power Generating Company Private Ltd
- Port Waratah Coal Services - Australia
- Sojitz Corporation - Japan
- Kepco SPC Power Corporation, Philippines
- Independent Power Producers Association of India
- Power Finance Corporation Ltd., India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Standard Chartered Bank - UAE
- Tamil Nadu electricity Board
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Eastern Coal Council - USA
- Aditya Birla Group - India
- Mercator Lines Limited - India
- Binh Thuan Hamico - Vietnam
- Riau Bara Harum - Indonesia
- International Coal Ventures Pvt Ltd - India
- Thiess Contractors Indonesia
- Kideco Jaya Agung - Indonesia
- Therma Luzon, Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Wilmar Investment Holdings
- Merrill Lynch Commodities Europe
- Xindia Steels Limited - India
- The University of Queensland
- Uttam Galva Steels Limited - India
- Electricity Generating Authority of Thailand
- Posco Energy - South Korea
- Krishnapatnam Port Company Ltd. - India
- TeaM Sual Corporation - Philippines
- Jorong Barutama Greston.PT - Indonesia
- Formosa Plastics Group - Taiwan
- Planning Commission, India
- Star Paper Mills Limited - India
- Sinarmas Energy and Mining - Indonesia
- Coastal Gujarat Power Limited - India
- Anglo American - United Kingdom
- Indo Tambangraya Megah - Indonesia
- Globalindo Alam Lestari - Indonesia
- Mjunction Services Limited - India
- Pendopo Energi Batubara - Indonesia
- GMR Energy Limited - India
- Banpu Public Company Limited - Thailand
- Parliament of New Zealand
- Indian Oil Corporation Limited
- Global Coal Blending Company Limited - Australia
- Iligan Light & Power Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- Orica Australia Pty. Ltd.
- Interocean Group of Companies - India
- Petrochimia International Co. Ltd.- Taiwan
- India Bulls Power Limited - India
- AsiaOL BioFuels Corp., Philippines
- OPG Power Generation Pvt Ltd - India
- Ambuja Cements Ltd - India
- Antam Resourcindo - Indonesia
- Thai Mozambique Logistica
- Ministry of Mines - Canada
- White Energy Company Limited
- Economic Council, Georgia
- Siam City Cement - Thailand
- Malabar Cements Ltd - India
- Wood Mackenzie - Singapore
- Medco Energi Mining Internasional
- Bhoruka Overseas - Indonesia
- Romanian Commodities Exchange
- Ministry of Transport, Egypt
- Grasim Industreis Ltd - India
- CIMB Investment Bank - Malaysia
- Renaissance Capital - South Africa
- Bulk Trading Sa - Switzerland
- Karbindo Abesyapradhi - Indoneisa
- Goldman Sachs - Singapore
- Cement Manufacturers Association - India
- Simpson Spence & Young - Indonesia
- Bayan Resources Tbk. - Indonesia
- Gujarat Electricity Regulatory Commission - India
- GVK Power & Infra Limited - India
- Oldendorff Carriers - Singapore
- Marubeni Corporation - India
- Leighton Contractors Pty Ltd - Australia
- Semirara Mining and Power Corporation, Philippines
- Meralco Power Generation, Philippines
- IEA Clean Coal Centre - UK
- Kaltim Prima Coal - Indonesia
- Chamber of Mines of South Africa
- Chettinad Cement Corporation Ltd - India
- Orica Mining Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Heidelberg Cement - Germany
- Bahari Cakrawala Sebuku - Indonesia
- Aboitiz Power Corporation - Philippines
- SMG Consultants - Indonesia
- Salva Resources Pvt Ltd - India
- Vedanta Resources Plc - India
- Latin American Coal - Colombia
- Indogreen Group - Indonesia
- Samtan Co., Ltd - South Korea
- IHS Mccloskey Coal Group - USA
- ASAPP Information Group - India
- Price Waterhouse Coopers - Russia
- Maharashtra Electricity Regulatory Commission - India
- Manunggal Multi Energi - Indonesia
- Global Green Power PLC Corporation, Philippines
- Eastern Energy - Thailand
- Bhushan Steel Limited - India
- Makarim & Taira - Indonesia
- Ministry of Finance - Indonesia
- Carbofer General Trading SA - India
- Tata Chemicals Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Jaiprakash Power Ventures ltd
- Gujarat Mineral Development Corp Ltd - India
- Coal and Oil Company - UAE
- Deloitte Consulting - India
- London Commodity Brokers - England
- Essar Steel Hazira Ltd - India
- Meenaskhi Energy Private Limited - India
- The State Trading Corporation of India Ltd
- Jindal Steel & Power Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Indika Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Ceylon Electricity Board - Sri Lanka
- Trasteel International SA, Italy
- Kartika Selabumi Mining - Indonesia
- Straits Asia Resources Limited - Singapore
- PowerSource Philippines DevCo
- Kohat Cement Company Ltd. - Pakistan
- Australian Coal Association
- Bangladesh Power Developement Board
- Gujarat Sidhee Cement - India
- Metalloyd Limited - United Kingdom
- Bharathi Cement Corporation - India
- Videocon Industries ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- ICICI Bank Limited - India
- Bhatia International Limited - India
- Rio Tinto Coal - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Africa Commodities Group - South Africa
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Energy Development Corp, Philippines
- San Jose City I Power Corp, Philippines
- Global Business Power Corporation, Philippines
- Central Electricity Authority - India
- Intertek Mineral Services - Indonesia
- Mercuria Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Mintek Dendrill Indonesia
- Ind-Barath Power Infra Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Indonesian Coal Mining Association
- European Bulk Services B.V. - Netherlands
- VISA Power Limited - India
- SMC Global Power, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Sakthi Sugars Limited - India
- Borneo Indobara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Madhucon Powers Ltd - India
- The Treasury - Australian Government
- South Luzon Thermal Energy Corporation
- Barasentosa Lestari - Indonesia
- CNBM International Corporation - China
- Semirara Mining Corp, Philippines
- Georgia Ports Authority, United States
- Dalmia Cement Bharat India
- Siam City Cement PLC, Thailand
- Kapuas Tunggal Persada - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Agrawal Coal Company - India
- Central Java Power - Indonesia
- Minerals Council of Australia
- Alfred C Toepfer International GmbH - Germany
- Kobexindo Tractors - Indoneisa
- Vizag Seaport Private Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- McConnell Dowell - Australia
- Lanco Infratech Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Sree Jayajothi Cements Limited - India
- Coalindo Energy - Indonesia
- Altura Mining Limited, Indonesia
- GAC Shipping (India) Pvt Ltd
- MS Steel International - UAE
- Australian Commodity Traders Exchange
- Bank of Tokyo Mitsubishi UFJ Ltd
- Singapore Mercantile Exchange
- New Zealand Coal & Carbon
- Edison Trading Spa - Italy
- PNOC Exploration Corporation - Philippines
- Larsen & Toubro Limited - India
- PTC India Limited - India
- Karaikal Port Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Toyota Tsusho Corporation, Japan
- Parry Sugars Refinery, India
- Directorate Of Revenue Intelligence - India
- Baramulti Group, Indonesia
- Bukit Baiduri Energy - Indonesia
- Petron Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Vijayanagar Sugar Pvt Ltd - India
- Electricity Authority, New Zealand
- Kumho Petrochemical, South Korea
- Kalimantan Lumbung Energi - Indonesia
- Maheswari Brothers Coal Limited - India
- Indian Energy Exchange, India
- Sical Logistics Limited - India
- Sarangani Energy Corporation, Philippines
- Attock Cement Pakistan Limited
- Savvy Resources Ltd - HongKong
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