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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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Friday, 06 September 13
DRY BULK MARKET REACHES NEW YEAR-HIGHS ON THE BACK OF INCREASED CAPESIZE DEMAND - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The dry bulk market has been on the rise once again, but this time around any new increase of freight rates translates into new year-highs, thus bri ...
Friday, 06 September 13
US PRODUCED APPROXIMATELY 90.80 MMST OF COAL IN AUGUST
COALspot.com – United states the world’s second largest coal producer produced totaled approximately 20.90 million short tons (mmst) of ...
Thursday, 05 September 13
INDONESIAN COAL EXPORTS UP BY 6.72 PERCENT IN JULY
COALspot.com: Indonesia, the world's largest multi grade coal exporter shipped 35.268* million tons of coal in July 2013. Indonesian coal exp ...
Thursday, 05 September 13
HANDY: NICKEL ORE WAS PUSHING THE FAR EAST MARKET - FEARNLEYS
Handy
Nickel Ore was pushing the Feast market, several ships were fixed from low teens to $14k. Indo/India was still supported by bauxite, while th ...
Thursday, 05 September 13
DRY BULK MARKET ON A HIGH ROLL, MAINLY THANKS TO CAPESIZE APPETITE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Capesize owners have been rejoycing on the back of renewed optimism for the further rise in the dry bulk market's freight rates, especially when on ...
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- Uttam Galva Steels Limited - India
- Intertek Mineral Services - Indonesia
- Indo Tambangraya Megah - Indonesia
- VISA Power Limited - India
- Planning Commission, India
- Bhatia International Limited - India
- Wilmar Investment Holdings
- Coal and Oil Company - UAE
- Anglo American - United Kingdom
- Oldendorff Carriers - Singapore
- Vedanta Resources Plc - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sinarmas Energy and Mining - Indonesia
- Pendopo Energi Batubara - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Tamil Nadu electricity Board
- Standard Chartered Bank - UAE
- Carbofer General Trading SA - India
- Power Finance Corporation Ltd., India
- Electricity Generating Authority of Thailand
- Global Business Power Corporation, Philippines
- New Zealand Coal & Carbon
- Energy Development Corp, Philippines
- European Bulk Services B.V. - Netherlands
- Attock Cement Pakistan Limited
- GMR Energy Limited - India
- Iligan Light & Power Inc, Philippines
- Agrawal Coal Company - India
- Eastern Energy - Thailand
- Singapore Mercantile Exchange
- London Commodity Brokers - England
- Eastern Coal Council - USA
- Mercator Lines Limited - India
- Salva Resources Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- PTC India Limited - India
- San Jose City I Power Corp, Philippines
- Coalindo Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Directorate General of MIneral and Coal - Indonesia
- Kaltim Prima Coal - Indonesia
- Ministry of Mines - Canada
- Petrochimia International Co. Ltd.- Taiwan
- Makarim & Taira - Indonesia
- Larsen & Toubro Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Lanco Infratech Ltd - India
- Independent Power Producers Association of India
- Directorate Of Revenue Intelligence - India
- Jindal Steel & Power Ltd - India
- Indonesian Coal Mining Association
- Orica Australia Pty. Ltd.
- Videocon Industries ltd - India
- Ceylon Electricity Board - Sri Lanka
- Straits Asia Resources Limited - Singapore
- Timah Investasi Mineral - Indoneisa
- The University of Queensland
- Leighton Contractors Pty Ltd - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Samtan Co., Ltd - South Korea
- Karaikal Port Pvt Ltd - India
- Indian Energy Exchange, India
- Renaissance Capital - South Africa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Edison Trading Spa - Italy
- Rashtriya Ispat Nigam Limited - India
- Aboitiz Power Corporation - Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- SMC Global Power, Philippines
- Bukit Baiduri Energy - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Star Paper Mills Limited - India
- Kepco SPC Power Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Goldman Sachs - Singapore
- Central Java Power - Indonesia
- Africa Commodities Group - South Africa
- Indika Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Vizag Seaport Private Limited - India
- Metalloyd Limited - United Kingdom
- Thiess Contractors Indonesia
- The Treasury - Australian Government
- Latin American Coal - Colombia
- LBH Netherlands Bv - Netherlands
- Mjunction Services Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Krishnapatnam Port Company Ltd. - India
- Global Green Power PLC Corporation, Philippines
- Medco Energi Mining Internasional
- Kartika Selabumi Mining - Indonesia
- Bharathi Cement Corporation - India
- TeaM Sual Corporation - Philippines
- Bulk Trading Sa - Switzerland
- Barasentosa Lestari - Indonesia
- Price Waterhouse Coopers - Russia
- Maheswari Brothers Coal Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Madhucon Powers Ltd - India
- Trasteel International SA, Italy
- Meenaskhi Energy Private Limited - India
- Australian Commodity Traders Exchange
- IEA Clean Coal Centre - UK
- ICICI Bank Limited - India
- CIMB Investment Bank - Malaysia
- Electricity Authority, New Zealand
- Kumho Petrochemical, South Korea
- Wood Mackenzie - Singapore
- Semirara Mining and Power Corporation, Philippines
- Australian Coal Association
- SMG Consultants - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Gujarat Electricity Regulatory Commission - India
- Deloitte Consulting - India
- Binh Thuan Hamico - Vietnam
- The State Trading Corporation of India Ltd
- Ministry of Finance - Indonesia
- Bukit Makmur.PT - Indonesia
- Jaiprakash Power Ventures ltd
- Sindya Power Generating Company Private Ltd
- Semirara Mining Corp, Philippines
- White Energy Company Limited
- Parliament of New Zealand
- GAC Shipping (India) Pvt Ltd
- Economic Council, Georgia
- Kapuas Tunggal Persada - Indonesia
- Globalindo Alam Lestari - Indonesia
- Baramulti Group, Indonesia
- ASAPP Information Group - India
- Interocean Group of Companies - India
- Siam City Cement PLC, Thailand
- Marubeni Corporation - India
- Mercuria Energy - Indonesia
- Port Waratah Coal Services - Australia
- Tata Chemicals Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Merrill Lynch Commodities Europe
- Bhushan Steel Limited - India
- Chettinad Cement Corporation Ltd - India
- Rio Tinto Coal - Australia
- Savvy Resources Ltd - HongKong
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- PowerSource Philippines DevCo
- Xindia Steels Limited - India
- Sical Logistics Limited - India
- Malabar Cements Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Dalmia Cement Bharat India
- Riau Bara Harum - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Georgia Ports Authority, United States
- Bangladesh Power Developement Board
- Coastal Gujarat Power Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Bayan Resources Tbk. - Indonesia
- Heidelberg Cement - Germany
- Sarangani Energy Corporation, Philippines
- Ambuja Cements Ltd - India
- Sojitz Corporation - Japan
- Therma Luzon, Inc, Philippines
- Asmin Koalindo Tuhup - Indonesia
- McConnell Dowell - Australia
- Indian Oil Corporation Limited
- South Luzon Thermal Energy Corporation
- Chamber of Mines of South Africa
- Global Coal Blending Company Limited - Australia
- Ind-Barath Power Infra Limited - India
- Minerals Council of Australia
- Grasim Industreis Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Banpu Public Company Limited - Thailand
- Essar Steel Hazira Ltd - India
- International Coal Ventures Pvt Ltd - India
- Romanian Commodities Exchange
- Toyota Tsusho Corporation, Japan
- Energy Link Ltd, New Zealand
- PetroVietnam Power Coal Import and Supply Company
- Parry Sugars Refinery, India
- Bahari Cakrawala Sebuku - Indonesia
- Aditya Birla Group - India
- Jorong Barutama Greston.PT - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Siam City Cement - Thailand
- Neyveli Lignite Corporation Ltd, - India
- Kohat Cement Company Ltd. - Pakistan
- MS Steel International - UAE
- Commonwealth Bank - Australia
- SN Aboitiz Power Inc, Philippines
- Meralco Power Generation, Philippines
- Posco Energy - South Korea
- Mintek Dendrill Indonesia
- OPG Power Generation Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Thai Mozambique Logistica
- Indogreen Group - Indonesia
- GVK Power & Infra Limited - India
- Simpson Spence & Young - Indonesia
- PNOC Exploration Corporation - Philippines
- Ministry of Transport, Egypt
- India Bulls Power Limited - India
- Sree Jayajothi Cements Limited - India
- Bhoruka Overseas - Indonesia
- Sakthi Sugars Limited - India
- IHS Mccloskey Coal Group - USA
- Orica Mining Services - Indonesia
- Antam Resourcindo - Indonesia
- Cement Manufacturers Association - India
- Central Electricity Authority - India
- CNBM International Corporation - China
- Borneo Indobara - Indonesia
- Formosa Plastics Group - Taiwan
- Kobexindo Tractors - Indoneisa
- Petron Corporation, Philippines
- Altura Mining Limited, Indonesia
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