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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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Thursday, 22 August 13
PANAMAX : PERIOD MARKET IS STILL BEING LED BY STRONGER SENTIMENT IN THE FFA'S - FEARNRESEARCH
Handy
This week started slowly as expected. Indo biz now rate APS around 7k +60k to china and around 8k+80k to India. However, there are some ships ...
Wednesday, 21 August 13
DRY BULK SHIPPING - POSITIVE WINDOW FOR CAPESIZE OWNERS - PETER SAND
By: Peter Sand, Chief Shipping Analyst, BIMCO
Demand:
“Expect the unexpected from the dry bulk market” was what we wrote last time ar ...
Wednesday, 21 August 13
RATES FOR CAPES MOVED DECISIVELY NORTH THIS WEEK - INTERMODAL
COALspot.com - Right when the BDI seemed ready for another dive below the 1000 points level, the Dry Bulk market made significant comeback this week ...
Tuesday, 20 August 13
AUSTRALIA NEWCASTLE COAL EXPORTS FALL 19.15 PERCENT ON WEEK
COALspot.com: Power plant and semi-soft coking coal shipments from Australia's Newcastle port fell 19.15 per cent week on week to 2.39 million mt f ...
Tuesday, 20 August 13
CAPESIZE RATES MORE SENSITIVE TO DEMAND - COMMODORE RESEARCH & CONSULTANCY
COALspot.com : Approximately 71.50 million tons of iron ore is now stockpiled at Chinese ports, 900,000 tons (-1%) less than a week ago, Commodore R ...
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- Madhucon Powers Ltd - India
- Ministry of Finance - Indonesia
- Coalindo Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Sree Jayajothi Cements Limited - India
- Commonwealth Bank - Australia
- Latin American Coal - Colombia
- Kohat Cement Company Ltd. - Pakistan
- GN Power Mariveles Coal Plant, Philippines
- Global Business Power Corporation, Philippines
- Uttam Galva Steels Limited - India
- Merrill Lynch Commodities Europe
- Formosa Plastics Group - Taiwan
- Miang Besar Coal Terminal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Wood Mackenzie - Singapore
- Billiton Holdings Pty Ltd - Australia
- Orica Mining Services - Indonesia
- Coal and Oil Company - UAE
- Sarangani Energy Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Sindya Power Generating Company Private Ltd
- Pendopo Energi Batubara - Indonesia
- Antam Resourcindo - Indonesia
- Baramulti Group, Indonesia
- Wilmar Investment Holdings
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bayan Resources Tbk. - Indonesia
- CNBM International Corporation - China
- Romanian Commodities Exchange
- Bhatia International Limited - India
- Independent Power Producers Association of India
- Straits Asia Resources Limited - Singapore
- Aboitiz Power Corporation - Philippines
- SMC Global Power, Philippines
- Meenaskhi Energy Private Limited - India
- Aditya Birla Group - India
- Simpson Spence & Young - Indonesia
- Sical Logistics Limited - India
- Attock Cement Pakistan Limited
- Interocean Group of Companies - India
- Petrochimia International Co. Ltd.- Taiwan
- Rashtriya Ispat Nigam Limited - India
- Medco Energi Mining Internasional
- Binh Thuan Hamico - Vietnam
- Kobexindo Tractors - Indoneisa
- Pipit Mutiara Jaya. PT, Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Lanco Infratech Ltd - India
- Gujarat Electricity Regulatory Commission - India
- LBH Netherlands Bv - Netherlands
- Siam City Cement - Thailand
- Australian Coal Association
- OPG Power Generation Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Cement Manufacturers Association - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Electricity Authority, New Zealand
- Orica Australia Pty. Ltd.
- Star Paper Mills Limited - India
- Parry Sugars Refinery, India
- Karaikal Port Pvt Ltd - India
- SMG Consultants - Indonesia
- Videocon Industries ltd - India
- The University of Queensland
- ASAPP Information Group - India
- Jindal Steel & Power Ltd - India
- Central Electricity Authority - India
- Therma Luzon, Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Indogreen Group - Indonesia
- Iligan Light & Power Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Vedanta Resources Plc - India
- Deloitte Consulting - India
- Agrawal Coal Company - India
- Kartika Selabumi Mining - Indonesia
- Oldendorff Carriers - Singapore
- Borneo Indobara - Indonesia
- Indian Oil Corporation Limited
- GAC Shipping (India) Pvt Ltd
- ICICI Bank Limited - India
- Global Green Power PLC Corporation, Philippines
- South Luzon Thermal Energy Corporation
- CIMB Investment Bank - Malaysia
- Timah Investasi Mineral - Indoneisa
- Bahari Cakrawala Sebuku - Indonesia
- Vizag Seaport Private Limited - India
- Chettinad Cement Corporation Ltd - India
- Standard Chartered Bank - UAE
- Metalloyd Limited - United Kingdom
- PTC India Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Semirara Mining Corp, Philippines
- New Zealand Coal & Carbon
- Mjunction Services Limited - India
- AsiaOL BioFuels Corp., Philippines
- Maheswari Brothers Coal Limited - India
- Gujarat Mineral Development Corp Ltd - India
- IHS Mccloskey Coal Group - USA
- Karbindo Abesyapradhi - Indoneisa
- Mintek Dendrill Indonesia
- VISA Power Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- San Jose City I Power Corp, Philippines
- Rio Tinto Coal - Australia
- Indian Energy Exchange, India
- Marubeni Corporation - India
- Carbofer General Trading SA - India
- Coastal Gujarat Power Limited - India
- Petron Corporation, Philippines
- Energy Development Corp, Philippines
- Xindia Steels Limited - India
- Ministry of Mines - Canada
- Thiess Contractors Indonesia
- Bhushan Steel Limited - India
- Trasteel International SA, Italy
- Renaissance Capital - South Africa
- Holcim Trading Pte Ltd - Singapore
- Posco Energy - South Korea
- White Energy Company Limited
- Bukit Baiduri Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Planning Commission, India
- International Coal Ventures Pvt Ltd - India
- Central Java Power - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Ambuja Cements Ltd - India
- Directorate Of Revenue Intelligence - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Meralco Power Generation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Georgia Ports Authority, United States
- Maharashtra Electricity Regulatory Commission - India
- Asmin Koalindo Tuhup - Indonesia
- Ind-Barath Power Infra Limited - India
- Thai Mozambique Logistica
- Kapuas Tunggal Persada - Indonesia
- European Bulk Services B.V. - Netherlands
- Intertek Mineral Services - Indonesia
- Tata Chemicals Ltd - India
- Altura Mining Limited, Indonesia
- Bangladesh Power Developement Board
- Tamil Nadu electricity Board
- Electricity Generating Authority of Thailand
- Minerals Council of Australia
- Eastern Energy - Thailand
- Malabar Cements Ltd - India
- Indo Tambangraya Megah - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- PNOC Exploration Corporation - Philippines
- The State Trading Corporation of India Ltd
- MS Steel International - UAE
- Leighton Contractors Pty Ltd - Australia
- Mercuria Energy - Indonesia
- Goldman Sachs - Singapore
- Toyota Tsusho Corporation, Japan
- Power Finance Corporation Ltd., India
- Semirara Mining and Power Corporation, Philippines
- Price Waterhouse Coopers - Russia
- SN Aboitiz Power Inc, Philippines
- Sakthi Sugars Limited - India
- The Treasury - Australian Government
- Larsen & Toubro Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Port Waratah Coal Services - Australia
- Edison Trading Spa - Italy
- Bhoruka Overseas - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Banpu Public Company Limited - Thailand
- Ministry of Transport, Egypt
- Indika Energy - Indonesia
- PowerSource Philippines DevCo
- GMR Energy Limited - India
- India Bulls Power Limited - India
- Sojitz Corporation - Japan
- Essar Steel Hazira Ltd - India
- McConnell Dowell - Australia
- Economic Council, Georgia
- Heidelberg Cement - Germany
- Indonesian Coal Mining Association
- GVK Power & Infra Limited - India
- Bukit Makmur.PT - Indonesia
- Mercator Lines Limited - India
- Kepco SPC Power Corporation, Philippines
- Eastern Coal Council - USA
- Kideco Jaya Agung - Indonesia
- Parliament of New Zealand
- Bukit Asam (Persero) Tbk - Indonesia
- Siam City Cement PLC, Thailand
- Barasentosa Lestari - Indonesia
- Savvy Resources Ltd - HongKong
- Global Coal Blending Company Limited - Australia
- Anglo American - United Kingdom
- Grasim Industreis Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Globalindo Alam Lestari - Indonesia
- Dalmia Cement Bharat India
- Kaltim Prima Coal - Indonesia
- Bharathi Cement Corporation - India
- Africa Commodities Group - South Africa
- Salva Resources Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Jorong Barutama Greston.PT - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Singapore Mercantile Exchange
- IEA Clean Coal Centre - UK
- Kumho Petrochemical, South Korea
- Australian Commodity Traders Exchange
- London Commodity Brokers - England
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Makarim & Taira - Indonesia
- Chamber of Mines of South Africa
- Samtan Co., Ltd - South Korea
- Riau Bara Harum - Indonesia
- TeaM Sual Corporation - Philippines
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