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Tuesday, 15 October 13
CHINA COAL IMPORTS TO KEEP GROWING IN THE YEARS TO COME, ALBEIT AT A SLOWER RATE - EVA TZIMA / NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
In its latest monthly report, shipbroker Intermodal highlighted the growing role of coal in the energy mix. According to Intermodal's research analyst, Eva Tzima, "since the beginning of 2013, there has been a lot of debate as for what the future might hold for the trade of coal. The majority of coal production is used to fuel coal-fired power plants in the form also known as thermal coal. Coal, which is today the source that feeds almost 40% of global electricity requirements, has been the fastest growing energy source since the beginning of the 21st century, ac-cording to the International Energy Agency. It’s been mainly on the back of developing economies, like those of China and India that the traded volume of the commodity has witnessed a rapid increase. With China being globally the biggest producer and consumer of thermal coal, the demand for the latter has been inextricably linked with that of economic growth in the world’s second largest econo-my. As the rate of Chinese economic growth has been slowing down, so has the rate of coal consumption, while at the same time, due to its non green nature, the popularity of coal as an energy source has been gathering less and less supporters worldwide", she noted.
Tzima added that "despite the fact that China has been sitting on trillions of tonnes of reserves and therefore local appetite for coal has been historically satisfied onshore, as of the end of 2008 the country’s coal imports have started to increase at a very fast pace. The big beneficiary of this trend was no other than the dry bulkers, as the majority of those imports is realized by seaborne trade. Last year alone the an-nual increase of imported amounts of coal into China touched al-most 60% compared to those of 2011. As we head into the final quarter of 2013 it seems that an even higher figure of imports will be printed, proving that the trend is still strong. A little less than one third of Chinese coal imports is currently being satisfied by Indonesian reserves, while other Pacific region countries like Australia and Vietnam also account for substantial portions".
According to Intermodal's analyst, "the question that naturally comes to mind is why turning to offshore supplies for coal when the commodity is plentiful right there in your court? The answer is simple; Price. The cost of producing and transporting coal domestically has been higher than importing it. But as the country’s imports have continued to rise and its economy has gone into a slower gear, Chinese stockpiles have also increased significantly, fact which in its turn has put significant pressure on local prices. Since January alone, coal prices in China have softened more than 15%. As local prices have been softening a lot of reports have surfaced warning about possible pressure on coal imports going forward. On top of that, the Chinese government, in its effort to pursue more environmental friendly policies, could also weigh down on the future quantity of coal cargoes imported. The energy targets initially set forth by the government, as part of its overall pollution control plan, included both a ceiling on the imported volume and use, as well as a floor on the quality of coal consumed in the coun-try, adding further to the negative sentiment around coal usage altogether", Tzima noted.
"So, will the trade of coal start burning low in the Pacific region? I would think that most probably not. On the one hand the infrastructure modernization needed, should the government keep pushing for lower emissions of CO2, will add on to the cost of Chinese pro-duction. This will be reflected on the price of locally produced coal, restricting the gap between domestic and international prices to narrow down to a point where imports would no longer make economic sense. On top of that, while local coal prices have been softening, the same has happened to coal prices globally and even at a higher degree, so the price incentive for Chinese demand to dis-tant itself from imports doesn’t appear to be there. At the same time what originally started as a very solid plan to cap imported quantities has slowly been revised to a less strict policy, which doesn’t seem as hurtful for imports as it was in its initial form. This revision shows that cheaper energy sources are likely to hold centre stage, as it seems quite possible that the Chinese government would chose to partly sacrifice its “Green” targets for its “Growth” targets. In fact while it has pledged to reduce the country’s coal usage to 65% of its total energy mix, a 2% reduction from what it is today, it hasn’t set a specific amount of coal consumption. This means that under the current plan, the Chinese will still allow for growth in coal consumption should the country’s energy needs continue to rise. But will they do? In my view the fact that the Chinese government has compromised with slower economic growth targets for a longer period of time, in order to ensure the sustainability of that growth, in itself is supportive of firm on-going energy consumption within the country. Following the path of slower but more sustainable growth, energy consumption should be maintained at its current growth levels rather than exhaust itself in the medium term follow-ing strong but short-lived periods of overconsumption.
So despite the fact that King Coal might be facing some opposition, it seems that the Chinese will continue to be supportive of both imports and consumption of the commodity. And unless dramatic action is taken by their government, imports should keep increasing in the next years. This will almost certainly be an increase at a slower rate, but an increase nevertheless, as cheaper options of the commodity will be still made available through seaborne trade in the Asia-Pacific region, allowing for coal to keep burning hotter for a longer period than what some might chose to think...", Tzima concluded
Research Analyst - Eva Tzima
Source: Nikos Roussanoglou, Hellenic Shipping News
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Saturday, 07 December 13
A RARE TIME IN RECENT SHIPPING MARKET HISTORY: BOTH DRY BULK AND VLCC TANKER EARNINGS ARE ON THE RISE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Around this time of year, back in 2008, i.e. five years ago, the shipping markets were plagued with the aftermath of the global financial crisis tha ...
Friday, 06 December 13
INDONESIAN PARLIAMENT REJECTED A GOVERNMENT PROPOSAL TO EASE THE BAN ON EXPORTING UNPROCESSED ORE
COALspot.com: Indonesian House of Representatives rejected a proposal from Energy and Mineral Resources Minister Jero Wacik on to ease the ban on ex ...
Friday, 06 December 13
THE MINISTRY OF ENERGY & MINERAL RESOURCES OF INDONESIA FIXED DEC'13 HBA AT US$ 80.31
COALspot.com - The Ministry of Energy & Mineral Resources of Indonesia has increased government declared coal bench mark price by US$ 2.18 / MT ...
Friday, 06 December 13
US PRODUCED APPROXIMATELY 82.8 MILLION SHORT TONS OF COAL IN NOVEMBER 2013
COALspot.com – United States the world’s second largest coal producer, produced approximately 19.00 million short tons (mmst) of coal in ...
Friday, 06 December 13
PANAMAXES HAVE BEEN THE ' WEAPON OF CHOICE' BY MOST DRY BULK SHIP OWNERS DURING 2013 - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Low ship prices, the direct consequence of subdued freight rates for the larger part of 2013 have been the main driving force behind this year's ag ...
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- Essar Steel Hazira Ltd - India
- Manunggal Multi Energi - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- SMC Global Power, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Africa Commodities Group - South Africa
- Indika Energy - Indonesia
- Central Java Power - Indonesia
- Videocon Industries ltd - India
- Larsen & Toubro Limited - India
- CNBM International Corporation - China
- TNB Fuel Sdn Bhd - Malaysia
- Global Green Power PLC Corporation, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Commonwealth Bank - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Chamber of Mines of South Africa
- Grasim Industreis Ltd - India
- Altura Mining Limited, Indonesia
- Sinarmas Energy and Mining - Indonesia
- Mercator Lines Limited - India
- Deloitte Consulting - India
- TeaM Sual Corporation - Philippines
- Banpu Public Company Limited - Thailand
- ICICI Bank Limited - India
- Bulk Trading Sa - Switzerland
- Meenaskhi Energy Private Limited - India
- Miang Besar Coal Terminal - Indonesia
- Baramulti Group, Indonesia
- Bhatia International Limited - India
- Barasentosa Lestari - Indonesia
- Vizag Seaport Private Limited - India
- Merrill Lynch Commodities Europe
- Posco Energy - South Korea
- Billiton Holdings Pty Ltd - Australia
- Romanian Commodities Exchange
- CIMB Investment Bank - Malaysia
- Kobexindo Tractors - Indoneisa
- Coal and Oil Company - UAE
- Ambuja Cements Ltd - India
- Tamil Nadu electricity Board
- Bhushan Steel Limited - India
- Renaissance Capital - South Africa
- Krishnapatnam Port Company Ltd. - India
- Sarangani Energy Corporation, Philippines
- Medco Energi Mining Internasional
- Kartika Selabumi Mining - Indonesia
- Coastal Gujarat Power Limited - India
- Marubeni Corporation - India
- Iligan Light & Power Inc, Philippines
- Edison Trading Spa - Italy
- Pendopo Energi Batubara - Indonesia
- Heidelberg Cement - Germany
- Toyota Tsusho Corporation, Japan
- Globalindo Alam Lestari - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Formosa Plastics Group - Taiwan
- Independent Power Producers Association of India
- Price Waterhouse Coopers - Russia
- Meralco Power Generation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kumho Petrochemical, South Korea
- Jorong Barutama Greston.PT - Indonesia
- Electricity Generating Authority of Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Australian Commodity Traders Exchange
- Maharashtra Electricity Regulatory Commission - India
- Bhoruka Overseas - Indonesia
- Economic Council, Georgia
- The Treasury - Australian Government
- Wood Mackenzie - Singapore
- Interocean Group of Companies - India
- Coalindo Energy - Indonesia
- White Energy Company Limited
- Sree Jayajothi Cements Limited - India
- Indo Tambangraya Megah - Indonesia
- McConnell Dowell - Australia
- Ministry of Finance - Indonesia
- Oldendorff Carriers - Singapore
- International Coal Ventures Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Gujarat Sidhee Cement - India
- Parry Sugars Refinery, India
- Malabar Cements Ltd - India
- Cement Manufacturers Association - India
- PowerSource Philippines DevCo
- Sical Logistics Limited - India
- AsiaOL BioFuels Corp., Philippines
- Bayan Resources Tbk. - Indonesia
- Australian Coal Association
- Vedanta Resources Plc - India
- Mintek Dendrill Indonesia
- Anglo American - United Kingdom
- Intertek Mineral Services - Indonesia
- Makarim & Taira - Indonesia
- Kepco SPC Power Corporation, Philippines
- Latin American Coal - Colombia
- Power Finance Corporation Ltd., India
- Straits Asia Resources Limited - Singapore
- Bharathi Cement Corporation - India
- Savvy Resources Ltd - HongKong
- Kalimantan Lumbung Energi - Indonesia
- Aditya Birla Group - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Holcim Trading Pte Ltd - Singapore
- Thiess Contractors Indonesia
- Indian Oil Corporation Limited
- Goldman Sachs - Singapore
- Lanco Infratech Ltd - India
- European Bulk Services B.V. - Netherlands
- Thai Mozambique Logistica
- Indogreen Group - Indonesia
- Bukit Baiduri Energy - Indonesia
- Ministry of Mines - Canada
- Energy Development Corp, Philippines
- The State Trading Corporation of India Ltd
- Bukit Asam (Persero) Tbk - Indonesia
- Metalloyd Limited - United Kingdom
- Antam Resourcindo - Indonesia
- South Luzon Thermal Energy Corporation
- Alfred C Toepfer International GmbH - Germany
- GVK Power & Infra Limited - India
- Trasteel International SA, Italy
- Samtan Co., Ltd - South Korea
- Attock Cement Pakistan Limited
- Global Business Power Corporation, Philippines
- IEA Clean Coal Centre - UK
- LBH Netherlands Bv - Netherlands
- Madhucon Powers Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Karbindo Abesyapradhi - Indoneisa
- Borneo Indobara - Indonesia
- Kaltim Prima Coal - Indonesia
- Agrawal Coal Company - India
- Wilmar Investment Holdings
- Siam City Cement PLC, Thailand
- San Jose City I Power Corp, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Orica Australia Pty. Ltd.
- Mjunction Services Limited - India
- Binh Thuan Hamico - Vietnam
- Central Electricity Authority - India
- Eastern Energy - Thailand
- Riau Bara Harum - Indonesia
- London Commodity Brokers - England
- Bangladesh Power Developement Board
- Directorate Of Revenue Intelligence - India
- Semirara Mining Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- Petron Corporation, Philippines
- Energy Link Ltd, New Zealand
- Therma Luzon, Inc, Philippines
- Georgia Ports Authority, United States
- Ceylon Electricity Board - Sri Lanka
- Eastern Coal Council - USA
- India Bulls Power Limited - India
- Jaiprakash Power Ventures ltd
- Uttam Galva Steels Limited - India
- PNOC Exploration Corporation - Philippines
- Singapore Mercantile Exchange
- OPG Power Generation Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- ASAPP Information Group - India
- Indian Energy Exchange, India
- New Zealand Coal & Carbon
- Siam City Cement - Thailand
- Kapuas Tunggal Persada - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GAC Shipping (India) Pvt Ltd
- GMR Energy Limited - India
- PTC India Limited - India
- Chettinad Cement Corporation Ltd - India
- Global Coal Blending Company Limited - Australia
- Electricity Authority, New Zealand
- Bahari Cakrawala Sebuku - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Planning Commission, India
- Dalmia Cement Bharat India
- Simpson Spence & Young - Indonesia
- Ministry of Transport, Egypt
- Star Paper Mills Limited - India
- The University of Queensland
- Orica Mining Services - Indonesia
- VISA Power Limited - India
- Sakthi Sugars Limited - India
- Salva Resources Pvt Ltd - India
- Minerals Council of Australia
- Semirara Mining and Power Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- SMG Consultants - Indonesia
- IHS Mccloskey Coal Group - USA
- Rio Tinto Coal - Australia
- Mercuria Energy - Indonesia
- Tata Chemicals Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Asmin Koalindo Tuhup - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- SN Aboitiz Power Inc, Philippines
- Sojitz Corporation - Japan
- Port Waratah Coal Services - Australia
- Bukit Makmur.PT - Indonesia
- Standard Chartered Bank - UAE
- Rashtriya Ispat Nigam Limited - India
- Parliament of New Zealand
- Timah Investasi Mineral - Indoneisa
- Kideco Jaya Agung - Indonesia
- Carbofer General Trading SA - India
- Gujarat Mineral Development Corp Ltd - India
- Jindal Steel & Power Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Indonesian Coal Mining Association
- Sindya Power Generating Company Private Ltd
- Xindia Steels Limited - India
- MS Steel International - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Maheswari Brothers Coal Limited - India
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