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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, 10 November 13
PANAMAX COAL FREIGHT RATES REMAIN UNDER PRESSURE; SUPRAMAX BIGGEST GAINER - REDDY
COALspot.com: The freight market was up this week with all indices increased except for Panamax index.
The BDI was up by 56 points closing at 158 ...
Friday, 08 November 13
DRY BULK MARKET BOUNCES BACK ON RENEWED DEMAND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market staged a mild comeback this week, as the industry's benchmark, the Baltic Dry Index (BDI) inched forward step by step and bit b ...
Friday, 08 November 13
US'S OCTOBER COAL PRODUCTION INCREASED BY 1.78% M-M - EIA
COALspot.com – United States the world’s second largest coal producer, produced approximately 19.3 million short tons (mmst) of coal in ...
Thursday, 07 November 13
FORMOSA PLASTICS SEEKS 80K MT OF 5850 GAR COAL
COALspot.com: Taiwan's Formosa Plastics Group is inviting bids for 80,000 mt of bituminous coal for delivery in Nov - Dec'13 for its Chi ...
Thursday, 07 November 13
INDONESIAN COAL EXPORT VOLUME INCREASED; REVENUE DECREASED
COALspot.com: Indonesia, the 15th largest economy, 4th largest coal producer in the world and world's largest multi grade coal exporter shipp ...
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- Ministry of Transport, Egypt
- Wood Mackenzie - Singapore
- Karaikal Port Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Deloitte Consulting - India
- Bahari Cakrawala Sebuku - Indonesia
- South Luzon Thermal Energy Corporation
- Sinarmas Energy and Mining - Indonesia
- GVK Power & Infra Limited - India
- Ceylon Electricity Board - Sri Lanka
- The State Trading Corporation of India Ltd
- International Coal Ventures Pvt Ltd - India
- Indika Energy - Indonesia
- Binh Thuan Hamico - Vietnam
- Alfred C Toepfer International GmbH - Germany
- Videocon Industries ltd - India
- Rashtriya Ispat Nigam Limited - India
- Dalmia Cement Bharat India
- Salva Resources Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Independent Power Producers Association of India
- Baramulti Group, Indonesia
- Makarim & Taira - Indonesia
- Medco Energi Mining Internasional
- Bhoruka Overseas - Indonesia
- Simpson Spence & Young - Indonesia
- Globalindo Alam Lestari - Indonesia
- Cement Manufacturers Association - India
- Agrawal Coal Company - India
- Australian Coal Association
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Energy Development Corp, Philippines
- Commonwealth Bank - Australia
- Karbindo Abesyapradhi - Indoneisa
- Electricity Generating Authority of Thailand
- Grasim Industreis Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- London Commodity Brokers - England
- Altura Mining Limited, Indonesia
- Riau Bara Harum - Indonesia
- Ministry of Mines - Canada
- Indian Oil Corporation Limited
- Miang Besar Coal Terminal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Pipit Mutiara Jaya. PT, Indonesia
- Trasteel International SA, Italy
- Timah Investasi Mineral - Indoneisa
- Rio Tinto Coal - Australia
- Electricity Authority, New Zealand
- Anglo American - United Kingdom
- Mercuria Energy - Indonesia
- Jindal Steel & Power Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- IHS Mccloskey Coal Group - USA
- Coastal Gujarat Power Limited - India
- Aboitiz Power Corporation - Philippines
- Ambuja Cements Ltd - India
- Renaissance Capital - South Africa
- Essar Steel Hazira Ltd - India
- Semirara Mining Corp, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Sree Jayajothi Cements Limited - India
- Oldendorff Carriers - Singapore
- Jorong Barutama Greston.PT - Indonesia
- Coalindo Energy - Indonesia
- PTC India Limited - India
- Cigading International Bulk Terminal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Indogreen Group - Indonesia
- Manunggal Multi Energi - Indonesia
- Wilmar Investment Holdings
- Georgia Ports Authority, United States
- Sindya Power Generating Company Private Ltd
- Posco Energy - South Korea
- Semirara Mining and Power Corporation, Philippines
- Ministry of Finance - Indonesia
- Carbofer General Trading SA - India
- Aditya Birla Group - India
- The Treasury - Australian Government
- Gujarat Electricity Regulatory Commission - India
- Singapore Mercantile Exchange
- SMG Consultants - Indonesia
- San Jose City I Power Corp, Philippines
- Borneo Indobara - Indonesia
- Bhatia International Limited - India
- Sojitz Corporation - Japan
- Kideco Jaya Agung - Indonesia
- ASAPP Information Group - India
- Merrill Lynch Commodities Europe
- Australian Commodity Traders Exchange
- Tata Chemicals Ltd - India
- CNBM International Corporation - China
- Mjunction Services Limited - India
- PowerSource Philippines DevCo
- SN Aboitiz Power Inc, Philippines
- Savvy Resources Ltd - HongKong
- ICICI Bank Limited - India
- Edison Trading Spa - Italy
- TeaM Sual Corporation - Philippines
- Orica Mining Services - Indonesia
- Eastern Coal Council - USA
- Economic Council, Georgia
- Planning Commission, India
- White Energy Company Limited
- Ind-Barath Power Infra Limited - India
- Larsen & Toubro Limited - India
- Global Business Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Bukit Baiduri Energy - Indonesia
- Tamil Nadu electricity Board
- New Zealand Coal & Carbon
- Thai Mozambique Logistica
- Marubeni Corporation - India
- Lanco Infratech Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Chamber of Mines of South Africa
- GN Power Mariveles Coal Plant, Philippines
- Indian Energy Exchange, India
- Barasentosa Lestari - Indonesia
- Eastern Energy - Thailand
- Formosa Plastics Group - Taiwan
- Global Coal Blending Company Limited - Australia
- Krishnapatnam Port Company Ltd. - India
- Bhushan Steel Limited - India
- Siam City Cement - Thailand
- Meralco Power Generation, Philippines
- Vedanta Resources Plc - India
- Malabar Cements Ltd - India
- CIMB Investment Bank - Malaysia
- Interocean Group of Companies - India
- VISA Power Limited - India
- Port Waratah Coal Services - Australia
- IEA Clean Coal Centre - UK
- Meenaskhi Energy Private Limited - India
- Kapuas Tunggal Persada - Indonesia
- Gujarat Sidhee Cement - India
- Uttam Galva Steels Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Bukit Makmur.PT - Indonesia
- Therma Luzon, Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Pendopo Energi Batubara - Indonesia
- Billiton Holdings Pty Ltd - Australia
- McConnell Dowell - Australia
- Kaltim Prima Coal - Indonesia
- Xindia Steels Limited - India
- Central Java Power - Indonesia
- SMC Global Power, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Kumho Petrochemical, South Korea
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Petron Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Antam Resourcindo - Indonesia
- Energy Link Ltd, New Zealand
- India Bulls Power Limited - India
- Intertek Mineral Services - Indonesia
- Vizag Seaport Private Limited - India
- European Bulk Services B.V. - Netherlands
- OPG Power Generation Pvt Ltd - India
- Goldman Sachs - Singapore
- Indonesian Coal Mining Association
- Sical Logistics Limited - India
- Heidelberg Cement - Germany
- Kepco SPC Power Corporation, Philippines
- Siam City Cement PLC, Thailand
- Standard Chartered Bank - UAE
- Mintek Dendrill Indonesia
- Parliament of New Zealand
- Price Waterhouse Coopers - Russia
- Indo Tambangraya Megah - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Africa Commodities Group - South Africa
- The University of Queensland
- Parry Sugars Refinery, India
- Power Finance Corporation Ltd., India
- Bukit Asam (Persero) Tbk - Indonesia
- Star Paper Mills Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Iligan Light & Power Inc, Philippines
- Sakthi Sugars Limited - India
- Thiess Contractors Indonesia
- Toyota Tsusho Corporation, Japan
- Metalloyd Limited - United Kingdom
- Jaiprakash Power Ventures ltd
- Directorate Of Revenue Intelligence - India
- Romanian Commodities Exchange
- Directorate General of MIneral and Coal - Indonesia
- Kartika Selabumi Mining - Indonesia
- LBH Netherlands Bv - Netherlands
- Madhucon Powers Ltd - India
- Straits Asia Resources Limited - Singapore
- Kobexindo Tractors - Indoneisa
- Minerals Council of Australia
- Bharathi Cement Corporation - India
- GAC Shipping (India) Pvt Ltd
- Mercator Lines Limited - India
- Banpu Public Company Limited - Thailand
- AsiaOL BioFuels Corp., Philippines
- Coal and Oil Company - UAE
- Central Electricity Authority - India
- Orica Australia Pty. Ltd.
- Sarangani Energy Corporation, Philippines
- MS Steel International - UAE
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Samtan Co., Ltd - South Korea
- Bulk Trading Sa - Switzerland
- Latin American Coal - Colombia
- Leighton Contractors Pty Ltd - Australia
- Attock Cement Pakistan Limited
- GMR Energy Limited - India
- Bangladesh Power Developement Board
- Dong Bac Coal Mineral Investment Coporation - Vietnam
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