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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, 12 October 13
PANAMAX: OWNERS ARE AT US$ 17-18.5K PER DAY; CHARTERERS ARE AT US$ 15.5-16K - CAPT. REDDY
COALspot.com - The futures market was heavily down on the cape size vessels and the physical average charterer rates on cape size vessels dropped by ...
Friday, 11 October 13
DRY BULK FREIGHT RATE POSITIVE MOMENTUM TO BE SUPPORTED BY HIGHER DEMAND SAYS BIMCO - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
BIMCO released its latest short term research on the shipping markets, estimating that the elevated level of Capesize TC average rates i ...
Friday, 11 October 13
US COAL PRODUCTION FALLS 7.70% IN SEPTEMBER
COALspot.com – United States the world’s second largest coal producer produced approximately 17.70 million short tons (mmst) of coal in ...
Thursday, 10 October 13
NPC AUSTRALIA SHIPPED 2.99 MILLION TONS OF COAL W-O-W
COALspot.com: Power plant and semi-soft coking coal shipments from Australia's Newcastle port up 12.04 per cent week on week to 2.99 million mt for ...
Thursday, 10 October 13
SEVERAL PANAMAX FIXTURES FOR 1 YEAR TC HAVE BEEN REPORTED AROUND $13.5K/DAY - FEARNRESEARCH
Handy
The market is not much fancy as several holidays in the Far East last week. Tonnage side seems tight in SE Asia but there are many of them in ...
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- Siam City Cement - Thailand
- Kepco SPC Power Corporation, Philippines
- Electricity Authority, New Zealand
- Mintek Dendrill Indonesia
- Agrawal Coal Company - India
- Tamil Nadu electricity Board
- MS Steel International - UAE
- Timah Investasi Mineral - Indoneisa
- PowerSource Philippines DevCo
- Intertek Mineral Services - Indonesia
- TeaM Sual Corporation - Philippines
- Chamber of Mines of South Africa
- Makarim & Taira - Indonesia
- Coastal Gujarat Power Limited - India
- Sinarmas Energy and Mining - Indonesia
- Independent Power Producers Association of India
- Kideco Jaya Agung - Indonesia
- Planning Commission, India
- Directorate General of MIneral and Coal - Indonesia
- Latin American Coal - Colombia
- Metalloyd Limited - United Kingdom
- Barasentosa Lestari - Indonesia
- Samtan Co., Ltd - South Korea
- Minerals Council of Australia
- Vizag Seaport Private Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Parliament of New Zealand
- Goldman Sachs - Singapore
- Miang Besar Coal Terminal - Indonesia
- Meralco Power Generation, Philippines
- Global Business Power Corporation, Philippines
- Vedanta Resources Plc - India
- Bhoruka Overseas - Indonesia
- Bhatia International Limited - India
- Standard Chartered Bank - UAE
- Kobexindo Tractors - Indoneisa
- Chettinad Cement Corporation Ltd - India
- Sakthi Sugars Limited - India
- Eastern Coal Council - USA
- European Bulk Services B.V. - Netherlands
- Petrochimia International Co. Ltd.- Taiwan
- The Treasury - Australian Government
- Karaikal Port Pvt Ltd - India
- VISA Power Limited - India
- Deloitte Consulting - India
- Price Waterhouse Coopers - Russia
- ASAPP Information Group - India
- San Jose City I Power Corp, Philippines
- Rio Tinto Coal - Australia
- Kumho Petrochemical, South Korea
- Borneo Indobara - Indonesia
- Toyota Tsusho Corporation, Japan
- Australian Coal Association
- Jaiprakash Power Ventures ltd
- Oldendorff Carriers - Singapore
- Sindya Power Generating Company Private Ltd
- Jindal Steel & Power Ltd - India
- SMG Consultants - Indonesia
- Bulk Trading Sa - Switzerland
- Bhushan Steel Limited - India
- LBH Netherlands Bv - Netherlands
- Power Finance Corporation Ltd., India
- Rashtriya Ispat Nigam Limited - India
- Energy Link Ltd, New Zealand
- Kapuas Tunggal Persada - Indonesia
- Ministry of Mines - Canada
- Formosa Plastics Group - Taiwan
- GN Power Mariveles Coal Plant, Philippines
- GMR Energy Limited - India
- Commonwealth Bank - Australia
- Therma Luzon, Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- Jorong Barutama Greston.PT - Indonesia
- Lanco Infratech Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Electricity Generating Authority of Thailand
- IHS Mccloskey Coal Group - USA
- Antam Resourcindo - Indonesia
- Romanian Commodities Exchange
- Tata Chemicals Ltd - India
- Posco Energy - South Korea
- Interocean Group of Companies - India
- Manunggal Multi Energi - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Parry Sugars Refinery, India
- New Zealand Coal & Carbon
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sree Jayajothi Cements Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Banpu Public Company Limited - Thailand
- Gujarat Sidhee Cement - India
- Star Paper Mills Limited - India
- Marubeni Corporation - India
- ICICI Bank Limited - India
- McConnell Dowell - Australia
- PTC India Limited - India
- Thai Mozambique Logistica
- Ministry of Transport, Egypt
- Offshore Bulk Terminal Pte Ltd, Singapore
- Straits Asia Resources Limited - Singapore
- Riau Bara Harum - Indonesia
- Larsen & Toubro Limited - India
- Merrill Lynch Commodities Europe
- Bukit Baiduri Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bayan Resources Tbk. - Indonesia
- Port Waratah Coal Services - Australia
- India Bulls Power Limited - India
- Eastern Energy - Thailand
- SMC Global Power, Philippines
- Mercator Lines Limited - India
- International Coal Ventures Pvt Ltd - India
- Indian Oil Corporation Limited
- Cigading International Bulk Terminal - Indonesia
- Bharathi Cement Corporation - India
- Krishnapatnam Port Company Ltd. - India
- Wood Mackenzie - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Petron Corporation, Philippines
- Videocon Industries ltd - India
- Xindia Steels Limited - India
- Semirara Mining Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Wilmar Investment Holdings
- White Energy Company Limited
- Sarangani Energy Corporation, Philippines
- Africa Commodities Group - South Africa
- Pendopo Energi Batubara - Indonesia
- Thiess Contractors Indonesia
- Dalmia Cement Bharat India
- The State Trading Corporation of India Ltd
- Madhucon Powers Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Malabar Cements Ltd - India
- SN Aboitiz Power Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- Maheswari Brothers Coal Limited - India
- Ambuja Cements Ltd - India
- Grasim Industreis Ltd - India
- Trasteel International SA, Italy
- Kaltim Prima Coal - Indonesia
- Mjunction Services Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Meenaskhi Energy Private Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Aboitiz Power Corporation - Philippines
- Carbofer General Trading SA - India
- Indonesian Coal Mining Association
- Iligan Light & Power Inc, Philippines
- Binh Thuan Hamico - Vietnam
- Cement Manufacturers Association - India
- Simpson Spence & Young - Indonesia
- Heidelberg Cement - Germany
- Globalindo Alam Lestari - Indonesia
- Indian Energy Exchange, India
- Indo Tambangraya Megah - Indonesia
- Coal and Oil Company - UAE
- Leighton Contractors Pty Ltd - Australia
- Central Electricity Authority - India
- Salva Resources Pvt Ltd - India
- Sojitz Corporation - Japan
- Gujarat Electricity Regulatory Commission - India
- Orica Australia Pty. Ltd.
- Orica Mining Services - Indonesia
- South Luzon Thermal Energy Corporation
- Essar Steel Hazira Ltd - India
- Savvy Resources Ltd - HongKong
- Energy Development Corp, Philippines
- Economic Council, Georgia
- Medco Energi Mining Internasional
- Sical Logistics Limited - India
- The University of Queensland
- GAC Shipping (India) Pvt Ltd
- Alfred C Toepfer International GmbH - Germany
- Global Coal Blending Company Limited - Australia
- Directorate Of Revenue Intelligence - India
- Neyveli Lignite Corporation Ltd, - India
- Ministry of Finance - Indonesia
- IEA Clean Coal Centre - UK
- Edison Trading Spa - Italy
- Ind-Barath Power Infra Limited - India
- OPG Power Generation Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Aditya Birla Group - India
- Georgia Ports Authority, United States
- Indogreen Group - Indonesia
- Bangladesh Power Developement Board
- Ceylon Electricity Board - Sri Lanka
- Singapore Mercantile Exchange
- Renaissance Capital - South Africa
- Bukit Asam (Persero) Tbk - Indonesia
- Altura Mining Limited, Indonesia
- Mercuria Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- PetroVietnam Power Coal Import and Supply Company
- CIMB Investment Bank - Malaysia
- Siam City Cement PLC, Thailand
- Australian Commodity Traders Exchange
- Baramulti Group, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Global Green Power PLC Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- CNBM International Corporation - China
- Attock Cement Pakistan Limited
- Coalindo Energy - Indonesia
- Central Java Power - Indonesia
- Indika Energy - Indonesia
- Uttam Galva Steels Limited - India
- GVK Power & Infra Limited - India
- Anglo American - United Kingdom
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- London Commodity Brokers - England
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