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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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Sunday, 01 December 13
PANAMAX RATES HAVE REBOUNDED - CAPT. REDDY
COALspot.com: The freight market was quite firm last week with all the indices increased. Cape Index was gained highest this week which supports inc ...
Saturday, 30 November 13
NTPC STARTED IMPORTING COAL THROUGH NW1 FOR ITS FARAKKA POWER PLANT
COALspot.com: In a pioneering and path breaking operation, the very first consignment of about 69,060 metric tons of imported coal bought by MV HUAY ...
Friday, 29 November 13
DRY BULK MARKET BACK ON HIGHER GROUND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market is strengthening as a result of higher demand for Capesize vessels. The BDI (Baltic Dry Index) was up by 146 points yesterday, e ...
Wednesday, 27 November 13
DRY SEGMENTS EXCEPTION OF PANAMAXES, REMAINED OVERALL STABLE - INTERMODAL
COALspot.com : The Dry Bulk market closed off the week in the red, albeit the decrease noted was of short scale. With the exception of Panamaxes, th ...
Wednesday, 27 November 13
US WHEAT IMPORTS TO BRAZIL, REACHED A 35 - YEAR HIGH - EVA TZIMA
COALspot.com: As I am going through a number of dry market fixtures reported since the beginning of October, my eyes instinctively stop where they d ...
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- Global Green Power PLC Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Essar Steel Hazira Ltd - India
- Toyota Tsusho Corporation, Japan
- Kaltim Prima Coal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Economic Council, Georgia
- Pipit Mutiara Jaya. PT, Indonesia
- Samtan Co., Ltd - South Korea
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Agrawal Coal Company - India
- Posco Energy - South Korea
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Meralco Power Generation, Philippines
- Dalmia Cement Bharat India
- MS Steel International - UAE
- Madhucon Powers Ltd - India
- GMR Energy Limited - India
- IEA Clean Coal Centre - UK
- Videocon Industries ltd - India
- Minerals Council of Australia
- Energy Link Ltd, New Zealand
- TNB Fuel Sdn Bhd - Malaysia
- Metalloyd Limited - United Kingdom
- SMG Consultants - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- TeaM Sual Corporation - Philippines
- Simpson Spence & Young - Indonesia
- McConnell Dowell - Australia
- Intertek Mineral Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- PetroVietnam Power Coal Import and Supply Company
- Cigading International Bulk Terminal - Indonesia
- Mercuria Energy - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- San Jose City I Power Corp, Philippines
- Chettinad Cement Corporation Ltd - India
- Oldendorff Carriers - Singapore
- Kobexindo Tractors - Indoneisa
- Bhushan Steel Limited - India
- Eastern Coal Council - USA
- Kideco Jaya Agung - Indonesia
- Cement Manufacturers Association - India
- SMC Global Power, Philippines
- Edison Trading Spa - Italy
- Bayan Resources Tbk. - Indonesia
- Indian Energy Exchange, India
- Salva Resources Pvt Ltd - India
- Chamber of Mines of South Africa
- Sojitz Corporation - Japan
- Independent Power Producers Association of India
- ASAPP Information Group - India
- PTC India Limited - India
- Bukit Baiduri Energy - Indonesia
- Rio Tinto Coal - Australia
- Sakthi Sugars Limited - India
- Parliament of New Zealand
- New Zealand Coal & Carbon
- Uttam Galva Steels Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Wood Mackenzie - Singapore
- Maheswari Brothers Coal Limited - India
- Anglo American - United Kingdom
- Port Waratah Coal Services - Australia
- Miang Besar Coal Terminal - Indonesia
- Electricity Authority, New Zealand
- Parry Sugars Refinery, India
- CNBM International Corporation - China
- Planning Commission, India
- Ceylon Electricity Board - Sri Lanka
- Semirara Mining Corp, Philippines
- European Bulk Services B.V. - Netherlands
- CIMB Investment Bank - Malaysia
- Coal and Oil Company - UAE
- Central Java Power - Indonesia
- London Commodity Brokers - England
- Romanian Commodities Exchange
- Tamil Nadu electricity Board
- Bharathi Cement Corporation - India
- Antam Resourcindo - Indonesia
- The Treasury - Australian Government
- Eastern Energy - Thailand
- Kartika Selabumi Mining - Indonesia
- Ministry of Finance - Indonesia
- Sarangani Energy Corporation, Philippines
- Aboitiz Power Corporation - Philippines
- Merrill Lynch Commodities Europe
- Indo Tambangraya Megah - Indonesia
- GVK Power & Infra Limited - India
- Bangladesh Power Developement Board
- PowerSource Philippines DevCo
- Vijayanagar Sugar Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Mjunction Services Limited - India
- Banpu Public Company Limited - Thailand
- Formosa Plastics Group - Taiwan
- Carbofer General Trading SA - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Ambuja Cements Ltd - India
- Interocean Group of Companies - India
- Gujarat Mineral Development Corp Ltd - India
- Meenaskhi Energy Private Limited - India
- Georgia Ports Authority, United States
- Power Finance Corporation Ltd., India
- Leighton Contractors Pty Ltd - Australia
- Coalindo Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Grasim Industreis Ltd - India
- Indonesian Coal Mining Association
- Offshore Bulk Terminal Pte Ltd, Singapore
- Deloitte Consulting - India
- Directorate General of MIneral and Coal - Indonesia
- Petron Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- Thai Mozambique Logistica
- Siam City Cement - Thailand
- Mercator Lines Limited - India
- Ind-Barath Power Infra Limited - India
- Orica Australia Pty. Ltd.
- Bhatia International Limited - India
- Jaiprakash Power Ventures ltd
- Holcim Trading Pte Ltd - Singapore
- Sical Logistics Limited - India
- Savvy Resources Ltd - HongKong
- Energy Development Corp, Philippines
- Krishnapatnam Port Company Ltd. - India
- Bhoruka Overseas - Indonesia
- Makarim & Taira - Indonesia
- International Coal Ventures Pvt Ltd - India
- Heidelberg Cement - Germany
- South Luzon Thermal Energy Corporation
- Commonwealth Bank - Australia
- Jorong Barutama Greston.PT - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- SN Aboitiz Power Inc, Philippines
- Baramulti Group, Indonesia
- Orica Mining Services - Indonesia
- Larsen & Toubro Limited - India
- Semirara Mining and Power Corporation, Philippines
- India Bulls Power Limited - India
- Aditya Birla Group - India
- Xindia Steels Limited - India
- VISA Power Limited - India
- White Energy Company Limited
- Price Waterhouse Coopers - Russia
- Trasteel International SA, Italy
- Bulk Trading Sa - Switzerland
- Wilmar Investment Holdings
- IHS Mccloskey Coal Group - USA
- LBH Netherlands Bv - Netherlands
- Altura Mining Limited, Indonesia
- Marubeni Corporation - India
- Standard Chartered Bank - UAE
- Vizag Seaport Private Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Mines - Canada
- Global Coal Blending Company Limited - Australia
- Rashtriya Ispat Nigam Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Borneo Indobara - Indonesia
- Central Electricity Authority - India
- Timah Investasi Mineral - Indoneisa
- Binh Thuan Hamico - Vietnam
- Renaissance Capital - South Africa
- Sree Jayajothi Cements Limited - India
- Kepco SPC Power Corporation, Philippines
- Lanco Infratech Ltd - India
- Medco Energi Mining Internasional
- Siam City Cement PLC, Thailand
- Star Paper Mills Limited - India
- Singapore Mercantile Exchange
- Tata Chemicals Ltd - India
- Latin American Coal - Colombia
- Australian Coal Association
- Mintek Dendrill Indonesia
- Gujarat Electricity Regulatory Commission - India
- Kumho Petrochemical, South Korea
- Maharashtra Electricity Regulatory Commission - India
- Straits Asia Resources Limited - Singapore
- Global Business Power Corporation, Philippines
- Ministry of Transport, Egypt
- OPG Power Generation Pvt Ltd - India
- Indika Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- AsiaOL BioFuels Corp., Philippines
- Gujarat Sidhee Cement - India
- Jindal Steel & Power Ltd - India
- Attock Cement Pakistan Limited
- Indogreen Group - Indonesia
- ICICI Bank Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- The State Trading Corporation of India Ltd
- Sindya Power Generating Company Private Ltd
- Karbindo Abesyapradhi - Indoneisa
- Thiess Contractors Indonesia
- Iligan Light & Power Inc, Philippines
- Barasentosa Lestari - Indonesia
- Indian Oil Corporation Limited
- GAC Shipping (India) Pvt Ltd
- Riau Bara Harum - Indonesia
- Australian Commodity Traders Exchange
- Alfred C Toepfer International GmbH - Germany
- Electricity Generating Authority of Thailand
- PNOC Exploration Corporation - Philippines
- Coastal Gujarat Power Limited - India
- Goldman Sachs - Singapore
- Malabar Cements Ltd - India
- Vedanta Resources Plc - India
- Therma Luzon, Inc, Philippines
- Africa Commodities Group - South Africa
- The University of Queensland
- Karaikal Port Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- Manunggal Multi Energi - Indonesia
- Directorate Of Revenue Intelligence - India
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