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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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Tuesday, 09 July 13
NEWCASTLE COAL EXPORTS JUMP 27.53% ON WEEK TO 2.97 MILLION MT
COALspot.com - Newcastle Coal exports up 27.53% to 2.97 million tons W-o-W.
Newcastle port in Australia has loaded 2,974,715 tons of coal for the ...
Tuesday, 09 July 13
CAPESIZE: SHOT UP; PANAMAXES: NOT SO LUCK; SUPRAS: SLIGHTLY BETTER; HANDIES: SOFT - INTERMODAL
COALspot.com : June 2013 Recap
A renewed Capesize market this month (June 2013) was the cause for much of the overall noteworthy performanc ...
Tuesday, 09 July 13
THE 11TH DEEP COAL PROCESSING FORUM 2013
Press Release : The 11th Deep Coal Processing Forum 2013 will be held in November Beijing China.
CDMC Events is pleased to announce that 11 ...
Monday, 08 July 13
ECO-FRIENDLY COAL FOR CHINA - VALUE FOR THE ENVIRONMENT AND VALUE FOR THE POWER GENERATOR - BY: LINDSAY JUNIPER
COALspot.com : January 2013 saw an episode of extreme particulate pollution in Beijing 35 times worse than the safe level recommended by the World H ...
Sunday, 07 July 13
FREIGHT MARKET IS EXPECTED TO BE SOFT TO STABLE NEXT WEEK- VISTAAR
COALspot.com - The freight market softened for the week ended 5 July 2013, and experienced a decline in all sectors, including BDI. Bulk dry Index d ...
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- Sree Jayajothi Cements Limited - India
- Gujarat Electricity Regulatory Commission - India
- Semirara Mining and Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Mercuria Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Energy Link Ltd, New Zealand
- Directorate Of Revenue Intelligence - India
- Lanco Infratech Ltd - India
- Savvy Resources Ltd - HongKong
- The University of Queensland
- Coalindo Energy - Indonesia
- ICICI Bank Limited - India
- OPG Power Generation Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Standard Chartered Bank - UAE
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- PowerSource Philippines DevCo
- Bhatia International Limited - India
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- Deloitte Consulting - India
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- Goldman Sachs - Singapore
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- Bayan Resources Tbk. - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- IEA Clean Coal Centre - UK
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- VISA Power Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Power Finance Corporation Ltd., India
- San Jose City I Power Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Anglo American - United Kingdom
- Meralco Power Generation, Philippines
- Electricity Authority, New Zealand
- South Luzon Thermal Energy Corporation
- Wood Mackenzie - Singapore
- Global Coal Blending Company Limited - Australia
- Thai Mozambique Logistica
- Makarim & Taira - Indonesia
- Renaissance Capital - South Africa
- Vedanta Resources Plc - India
- CNBM International Corporation - China
- Petrochimia International Co. Ltd.- Taiwan
- Heidelberg Cement - Germany
- GMR Energy Limited - India
- International Coal Ventures Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Bharathi Cement Corporation - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Parliament of New Zealand
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- Africa Commodities Group - South Africa
- Borneo Indobara - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Larsen & Toubro Limited - India
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- Bukit Baiduri Energy - Indonesia
- Mintek Dendrill Indonesia
- Ind-Barath Power Infra Limited - India
- SN Aboitiz Power Inc, Philippines
- Antam Resourcindo - Indonesia
- Madhucon Powers Ltd - India
- Attock Cement Pakistan Limited
- Sinarmas Energy and Mining - Indonesia
- Orica Mining Services - Indonesia
- Siam City Cement PLC, Thailand
- Baramulti Group, Indonesia
- Billiton Holdings Pty Ltd - Australia
- Samtan Co., Ltd - South Korea
- White Energy Company Limited
- Marubeni Corporation - India
- Planning Commission, India
- Semirara Mining Corp, Philippines
- Pendopo Energi Batubara - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ministry of Transport, Egypt
- Economic Council, Georgia
- TeaM Sual Corporation - Philippines
- Indian Oil Corporation Limited
- Gujarat Sidhee Cement - India
- Timah Investasi Mineral - Indoneisa
- Essar Steel Hazira Ltd - India
- Indian Energy Exchange, India
- Petron Corporation, Philippines
- Coal and Oil Company - UAE
- Indogreen Group - Indonesia
- Global Green Power PLC Corporation, Philippines
- Posco Energy - South Korea
- The Treasury - Australian Government
- Central Electricity Authority - India
- Electricity Generating Authority of Thailand
- Altura Mining Limited, Indonesia
- Xindia Steels Limited - India
- Aditya Birla Group - India
- Pipit Mutiara Jaya. PT, Indonesia
- PTC India Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Australian Commodity Traders Exchange
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- IHS Mccloskey Coal Group - USA
- London Commodity Brokers - England
- Toyota Tsusho Corporation, Japan
- Sical Logistics Limited - India
- Port Waratah Coal Services - Australia
- Star Paper Mills Limited - India
- Gujarat Mineral Development Corp Ltd - India
- SMG Consultants - Indonesia
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- Vizag Seaport Private Limited - India
- Indo Tambangraya Megah - Indonesia
- Romanian Commodities Exchange
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- LBH Netherlands Bv - Netherlands
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- Chettinad Cement Corporation Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Aboitiz Power Corporation - Philippines
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- Price Waterhouse Coopers - Russia
- Chamber of Mines of South Africa
- Orica Australia Pty. Ltd.
- Simpson Spence & Young - Indonesia
- Parry Sugars Refinery, India
- Jaiprakash Power Ventures ltd
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- Bulk Trading Sa - Switzerland
- Latin American Coal - Colombia
- Global Business Power Corporation, Philippines
- Minerals Council of Australia
- Kaltim Prima Coal - Indonesia
- Ministry of Finance - Indonesia
- Manunggal Multi Energi - Indonesia
- Bangladesh Power Developement Board
- Merrill Lynch Commodities Europe
- Jorong Barutama Greston.PT - Indonesia
- Tamil Nadu electricity Board
- Siam City Cement - Thailand
- Vijayanagar Sugar Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Metalloyd Limited - United Kingdom
- PNOC Exploration Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Ceylon Electricity Board - Sri Lanka
- Cement Manufacturers Association - India
- Georgia Ports Authority, United States
- MS Steel International - UAE
- Maharashtra Electricity Regulatory Commission - India
- Tata Chemicals Ltd - India
- Kumho Petrochemical, South Korea
- Wilmar Investment Holdings
- GAC Shipping (India) Pvt Ltd
- European Bulk Services B.V. - Netherlands
- Dalmia Cement Bharat India
- Videocon Industries ltd - India
- Central Java Power - Indonesia
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- Thiess Contractors Indonesia
- Mercator Lines Limited - India
- Ministry of Mines - Canada
- Grasim Industreis Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kartika Selabumi Mining - Indonesia
- Intertek Mineral Services - Indonesia
- AsiaOL BioFuels Corp., Philippines
- The State Trading Corporation of India Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Uttam Galva Steels Limited - India
- Coastal Gujarat Power Limited - India
- GVK Power & Infra Limited - India
- Bhushan Steel Limited - India
- Sindya Power Generating Company Private Ltd
- Interocean Group of Companies - India
- Alfred C Toepfer International GmbH - Germany
- Therma Luzon, Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Kepco SPC Power Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Barasentosa Lestari - Indonesia
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- Eastern Coal Council - USA
- Singapore Mercantile Exchange
- Oldendorff Carriers - Singapore
- Indika Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Australian Coal Association
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- Sojitz Corporation - Japan
- Sakthi Sugars Limited - India
- Edison Trading Spa - Italy
- Rashtriya Ispat Nigam Limited - India
- Formosa Plastics Group - Taiwan
- Riau Bara Harum - Indonesia
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