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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, 04 August 13
COAL SWAP MARKET HAS LOST DIRECTION; STRUGGLING TO CATCH UP
COALspot.com – Sub-Bit Indonesia coal swaps (FOB ) for average October 2013 delivery slightly down on day, week and month on Friday, 2 A ...
Sunday, 04 August 13
INDONESIA TO INDIA SUPRAMAX FREIGHT SOFT DUE TO HOLIDAYS IN INDONESIA - VISTAAR
COALspot.com : The freight market was fairly steady this week with the BDI recovering towards north since second half of the week with the support o ...
Friday, 02 August 13
DRY BULK MARKET STABILIZES ON RENEWED MARKET ACTIVITY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The dry bulk market has kept its positive footing this week, although it's still a far cry to deem the market situation as a growing one, especiall ...
Friday, 02 August 13
ASIA ACCOUNTS FOR 27.95 PERCENT OF US COAL EXPORTS IN Q1, 2013
COALspot.com – United states the world’s second largest coal producer produced totaled approximately 20.80 million short tons (mmst) of ...
Thursday, 01 August 13
CAPESIZE: THE FLOW OF CARGOES REMAINS RELATIVELY STABLE, AND THE PACIFIC IS LOOKING PROMISING - FEARNLEYS AS
Handy
The Pacific market is still facing low activity, so no wonder that the tonnage list is getting longer. It´s still Ramadan and only a fe ...
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- Indian Oil Corporation Limited
- Indo Tambangraya Megah - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Mintek Dendrill Indonesia
- Aboitiz Power Corporation - Philippines
- Holcim Trading Pte Ltd - Singapore
- Mercuria Energy - Indonesia
- Larsen & Toubro Limited - India
- Energy Link Ltd, New Zealand
- Bangladesh Power Developement Board
- McConnell Dowell - Australia
- Meralco Power Generation, Philippines
- Makarim & Taira - Indonesia
- Sakthi Sugars Limited - India
- Edison Trading Spa - Italy
- Power Finance Corporation Ltd., India
- Tamil Nadu electricity Board
- SMC Global Power, Philippines
- Australian Coal Association
- New Zealand Coal & Carbon
- The State Trading Corporation of India Ltd
- OPG Power Generation Pvt Ltd - India
- Ministry of Finance - Indonesia
- Siam City Cement PLC, Thailand
- PNOC Exploration Corporation - Philippines
- SN Aboitiz Power Inc, Philippines
- Renaissance Capital - South Africa
- Bukit Baiduri Energy - Indonesia
- Altura Mining Limited, Indonesia
- Port Waratah Coal Services - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Dalmia Cement Bharat India
- Directorate Of Revenue Intelligence - India
- Ministry of Mines - Canada
- Vedanta Resources Plc - India
- Romanian Commodities Exchange
- Mercator Lines Limited - India
- Star Paper Mills Limited - India
- Straits Asia Resources Limited - Singapore
- Neyveli Lignite Corporation Ltd, - India
- Uttam Galva Steels Limited - India
- Parliament of New Zealand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mjunction Services Limited - India
- Binh Thuan Hamico - Vietnam
- Indian Energy Exchange, India
- CIMB Investment Bank - Malaysia
- Eastern Coal Council - USA
- Globalindo Alam Lestari - Indonesia
- Gujarat Sidhee Cement - India
- Kobexindo Tractors - Indoneisa
- Videocon Industries ltd - India
- Metalloyd Limited - United Kingdom
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- ASAPP Information Group - India
- Bhushan Steel Limited - India
- Xindia Steels Limited - India
- Miang Besar Coal Terminal - Indonesia
- Karaikal Port Pvt Ltd - India
- Medco Energi Mining Internasional
- Singapore Mercantile Exchange
- Latin American Coal - Colombia
- Cement Manufacturers Association - India
- Iligan Light & Power Inc, Philippines
- Banpu Public Company Limited - Thailand
- Jaiprakash Power Ventures ltd
- Global Business Power Corporation, Philippines
- PTC India Limited - India
- Rio Tinto Coal - Australia
- Chettinad Cement Corporation Ltd - India
- GAC Shipping (India) Pvt Ltd
- Vizag Seaport Private Limited - India
- India Bulls Power Limited - India
- Toyota Tsusho Corporation, Japan
- Kumho Petrochemical, South Korea
- Indogreen Group - Indonesia
- IEA Clean Coal Centre - UK
- Commonwealth Bank - Australia
- Attock Cement Pakistan Limited
- Riau Bara Harum - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Planning Commission, India
- Kartika Selabumi Mining - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Barasentosa Lestari - Indonesia
- Price Waterhouse Coopers - Russia
- Orica Australia Pty. Ltd.
- Essar Steel Hazira Ltd - India
- Ind-Barath Power Infra Limited - India
- Sarangani Energy Corporation, Philippines
- The University of Queensland
- Jindal Steel & Power Ltd - India
- South Luzon Thermal Energy Corporation
- Lanco Infratech Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Independent Power Producers Association of India
- Ministry of Transport, Egypt
- Leighton Contractors Pty Ltd - Australia
- The Treasury - Australian Government
- Aditya Birla Group - India
- Bulk Trading Sa - Switzerland
- Sree Jayajothi Cements Limited - India
- Kapuas Tunggal Persada - Indonesia
- GVK Power & Infra Limited - India
- International Coal Ventures Pvt Ltd - India
- Minerals Council of Australia
- Australian Commodity Traders Exchange
- European Bulk Services B.V. - Netherlands
- London Commodity Brokers - England
- Alfred C Toepfer International GmbH - Germany
- Manunggal Multi Energi - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Kepco SPC Power Corporation, Philippines
- Bhatia International Limited - India
- Economic Council, Georgia
- Petron Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Gujarat Mineral Development Corp Ltd - India
- Simpson Spence & Young - Indonesia
- Coalindo Energy - Indonesia
- Borneo Indobara - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indonesian Coal Mining Association
- Standard Chartered Bank - UAE
- Bhoruka Overseas - Indonesia
- Tata Chemicals Ltd - India
- Therma Luzon, Inc, Philippines
- Thai Mozambique Logistica
- Intertek Mineral Services - Indonesia
- Chamber of Mines of South Africa
- Kideco Jaya Agung - Indonesia
- Thiess Contractors Indonesia
- VISA Power Limited - India
- Energy Development Corp, Philippines
- Coal and Oil Company - UAE
- Georgia Ports Authority, United States
- Deloitte Consulting - India
- Rashtriya Ispat Nigam Limited - India
- Cigading International Bulk Terminal - Indonesia
- Samtan Co., Ltd - South Korea
- Baramulti Group, Indonesia
- Electricity Authority, New Zealand
- Directorate General of MIneral and Coal - Indonesia
- Interocean Group of Companies - India
- Coastal Gujarat Power Limited - India
- Trasteel International SA, Italy
- Bharathi Cement Corporation - India
- Anglo American - United Kingdom
- Timah Investasi Mineral - Indoneisa
- Africa Commodities Group - South Africa
- Wood Mackenzie - Singapore
- Formosa Plastics Group - Taiwan
- Merrill Lynch Commodities Europe
- GMR Energy Limited - India
- Kaltim Prima Coal - Indonesia
- Bukit Makmur.PT - Indonesia
- Central Java Power - Indonesia
- Ambuja Cements Ltd - India
- Antam Resourcindo - Indonesia
- Malabar Cements Ltd - India
- Oldendorff Carriers - Singapore
- Meenaskhi Energy Private Limited - India
- ICICI Bank Limited - India
- Gujarat Electricity Regulatory Commission - India
- Asmin Koalindo Tuhup - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- San Jose City I Power Corp, Philippines
- Eastern Energy - Thailand
- Maharashtra Electricity Regulatory Commission - India
- Ceylon Electricity Board - Sri Lanka
- Wilmar Investment Holdings
- CNBM International Corporation - China
- Posco Energy - South Korea
- Jorong Barutama Greston.PT - Indonesia
- Sindya Power Generating Company Private Ltd
- PowerSource Philippines DevCo
- Grasim Industreis Ltd - India
- Marubeni Corporation - India
- Pendopo Energi Batubara - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Heidelberg Cement - Germany
- Sinarmas Energy and Mining - Indonesia
- Goldman Sachs - Singapore
- Semirara Mining Corp, Philippines
- Sojitz Corporation - Japan
- Petrochimia International Co. Ltd.- Taiwan
- Maheswari Brothers Coal Limited - India
- Bayan Resources Tbk. - Indonesia
- SMG Consultants - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Salva Resources Pvt Ltd - India
- Orica Mining Services - Indonesia
- LBH Netherlands Bv - Netherlands
- Indika Energy - Indonesia
- Sical Logistics Limited - India
- MS Steel International - UAE
- Central Electricity Authority - India
- Carbofer General Trading SA - India
- Madhucon Powers Ltd - India
- Agrawal Coal Company - India
- Billiton Holdings Pty Ltd - Australia
- Global Green Power PLC Corporation, Philippines
- White Energy Company Limited
- TeaM Sual Corporation - Philippines
- AsiaOL BioFuels Corp., Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Kalimantan Lumbung Energi - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Global Coal Blending Company Limited - Australia
- Electricity Generating Authority of Thailand
- Parry Sugars Refinery, India
- Kohat Cement Company Ltd. - Pakistan
- Savvy Resources Ltd - HongKong
- Siam City Cement - Thailand
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