We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Monday, 27 July 09
COKING COAL, IRON-ORE LIKELY TO BENEFIT NON-INTEGRATED STEEL PRODUCERS
 Economictimes reported that, The second half of the financial year 2008-09 was one of the toughest periods for steel companies, especially the non-integrated players without access to captive sources of raw material. The double whammy of falling sales realisation and higher input costs pulled down operating profit margins significantly.
The non-integrated producers continued to pay higher raw material prices as a part of long-term contracts signed during the beginning of the year. However, as old contracts have come to an end and new ones are being signed, these companies are breathing a sigh of relief.
The new contracts have taken into consideration the current market realty. The prices of two key inputs –
–iron ore and coking coal – have come down more than 50% in the spot market. As per reports, steel firms have signed long-term contracts for coking coal at around $110-120 per tonne and iron ore at $65-70 per tonne.
The new contract prices mark a decline of around two-thirds and one-third from their yearago levels for coking coal and iron ore, respectively. Steel prices have also fallen sharply during the same period. Because of these developments, it is essential to understand the impact of the new prices on the profitability of major steel producers, especially the non-integrated ones, for the next few quarters.
Steel prices in a number of countries have been regulated in past year, and India is no exception. Current international steel prices are 50% lower than year-ago levels and in India the decline has been 25-35 %. Accordingly, depending on the company’s market (domestic and overseas) exposure, the impact on profitability of new long-term contract will vary.
Going by international prices, a company with an operating margin of around 25% last year is expected to see a contraction in margin by around 1,000-1 ,300 basis points compared to year-ago levels. It means the fall in steel product prices outweighs the drop in input costs. The only solace for such a company is the improvement in margin from the previous two quarters. Sequentially, there could be an improvement of more than 500-1 ,000 basis points in the operating margin to 10-15 %.
For instance, many international steel producers reported either losses or a 5-8 % operating margin during the Mar ’09 quarter. Such companies are definitely going to see better days ahead. In India, Tata Steel, which has significant operations in Europe, is going to be one of the key beneficiaries. The operating margin of Corus, however, is not expected to exceed 2%. The new pricing will have a bigger impact on domestic companies.
Domestic steel prices have not fallen much due to government intervention and relatively higher domestic demand. Also, coking coal, which accounted for around two-thirds of raw material cost last year, has witnessed a much sharper decline in prices compared to iron ore. And most of the coking coal consumed in India is imported and its pricing depends more on the international environment rather than the domestic market. Hence new coking coal contract prices will capture the poor international market conditions.
The benefit of new long-term contracts for domestic players would depend on factors such as the extent of dependence on external suppliers for raw materials, actual contract prices and the month from which the contract became effective, among others. Higher the dependence on external suppliers, more the benefit.
Of the top five listed steel companies, JSW Steel and Ispat Industries are likely to benefit the most. The average operating margin from the September quarter onwards is expected to expand by around 1,000-1,500 basis points compared to the Mar ’09 quarter. The June quarter, however, will see a partial impact, depending on when the new contracts came into force.
Other top players that are likely to benefit are Steel Authority of India (Sail) and Jindal Steel & Power. Both of them are self-sufficient in iron ore but depend on outside suppliers for coking coal. The positive impact on the operating margin of these companies on account of the new prices would not be more than 500 basis points though.
Source: Economic Times - India Times
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Thursday, 30 July 09
KOMIPO OFFERED 3 MILLION MT IN TENDER, TEN TIMES OVERSUBSCRIBED
Korea Midland has received offers for 3 million mt of bituminous steam coal in its latest tender despite the power utility seeking only 300,000 mt, ...
Thursday, 30 July 09
PNOC FORGES JOINT VENTURES AS STEPS UP COAL OPERATIONS
The Philippine National Oil Co.-Exploration Corp. has entered joint venture agreements with food and beverage conglomerate San Miguel and Filipinas ...
Thursday, 30 July 09
NAMANE OF SOUTH AFRICA IN SUDAN COAL DEAL, BUSINESS REPORT SAYS
Namane of South Africa in Sudan Coal Deal, Business Report Says
Namane Resources Ltd. of South Africa signed a coal-supply agreement with the Nat ...
Wednesday, 29 July 09
RP COAL DEMAND TO SURGE BY 2014 - PHILIPPINES UPDATE
CEBU, Philippines - With the entry of new coal-fired power generation plants in the Philippines, the Department of Energy (DOE) projected an increas ...
Wednesday, 29 July 09
INDIA HUNGRY FOR OUR COKING COAL ASSETS
The Australian reported that, INDIA is about to embark on a program of rapid coal sector acquisitions in Australia as it looks to plug a huge annual ...
|
|
|
Showing 6546 to 6550 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- London Commodity Brokers - England
- LBH Netherlands Bv - Netherlands
- Anglo American - United Kingdom
- Cigading International Bulk Terminal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Economic Council, Georgia
- Heidelberg Cement - Germany
- PNOC Exploration Corporation - Philippines
- Central Electricity Authority - India
- Rashtriya Ispat Nigam Limited - India
- New Zealand Coal & Carbon
- Bank of Tokyo Mitsubishi UFJ Ltd
- European Bulk Services B.V. - Netherlands
- Thai Mozambique Logistica
- Maheswari Brothers Coal Limited - India
- Iligan Light & Power Inc, Philippines
- Indika Energy - Indonesia
- Indogreen Group - Indonesia
- Mercuria Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Posco Energy - South Korea
- Agrawal Coal Company - India
- Planning Commission, India
- Formosa Plastics Group - Taiwan
- Borneo Indobara - Indonesia
- Rio Tinto Coal - Australia
- Directorate General of MIneral and Coal - Indonesia
- Eastern Energy - Thailand
- Gujarat Sidhee Cement - India
- Georgia Ports Authority, United States
- Simpson Spence & Young - Indonesia
- VISA Power Limited - India
- The Treasury - Australian Government
- India Bulls Power Limited - India
- Bhatia International Limited - India
- Interocean Group of Companies - India
- Kartika Selabumi Mining - Indonesia
- Price Waterhouse Coopers - Russia
- Africa Commodities Group - South Africa
- IEA Clean Coal Centre - UK
- Timah Investasi Mineral - Indoneisa
- Meenaskhi Energy Private Limited - India
- Riau Bara Harum - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Salva Resources Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Tamil Nadu electricity Board
- MS Steel International - UAE
- Minerals Council of Australia
- The State Trading Corporation of India Ltd
- AsiaOL BioFuels Corp., Philippines
- Standard Chartered Bank - UAE
- Parry Sugars Refinery, India
- Malabar Cements Ltd - India
- Essar Steel Hazira Ltd - India
- Sree Jayajothi Cements Limited - India
- Videocon Industries ltd - India
- Commonwealth Bank - Australia
- Orica Mining Services - Indonesia
- Ministry of Finance - Indonesia
- Directorate Of Revenue Intelligence - India
- GVK Power & Infra Limited - India
- Indian Oil Corporation Limited
- GMR Energy Limited - India
- Attock Cement Pakistan Limited
- Renaissance Capital - South Africa
- Edison Trading Spa - Italy
- Coalindo Energy - Indonesia
- Chamber of Mines of South Africa
- ASAPP Information Group - India
- Ind-Barath Power Infra Limited - India
- Straits Asia Resources Limited - Singapore
- Coastal Gujarat Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Energy Development Corp, Philippines
- SMC Global Power, Philippines
- Banpu Public Company Limited - Thailand
- Global Coal Blending Company Limited - Australia
- GN Power Mariveles Coal Plant, Philippines
- Pendopo Energi Batubara - Indonesia
- Singapore Mercantile Exchange
- McConnell Dowell - Australia
- Lanco Infratech Ltd - India
- Uttam Galva Steels Limited - India
- Electricity Generating Authority of Thailand
- GAC Shipping (India) Pvt Ltd
- Manunggal Multi Energi - Indonesia
- Xindia Steels Limited - India
- The University of Queensland
- Wood Mackenzie - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Tata Chemicals Ltd - India
- Bhushan Steel Limited - India
- Kobexindo Tractors - Indoneisa
- Altura Mining Limited, Indonesia
- Kepco SPC Power Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Bulk Trading Sa - Switzerland
- Sojitz Corporation - Japan
- Krishnapatnam Port Company Ltd. - India
- Ceylon Electricity Board - Sri Lanka
- PTC India Limited - India
- Medco Energi Mining Internasional
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Siam City Cement - Thailand
- Karbindo Abesyapradhi - Indoneisa
- Port Waratah Coal Services - Australia
- Jindal Steel & Power Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Binh Thuan Hamico - Vietnam
- Kideco Jaya Agung - Indonesia
- Orica Australia Pty. Ltd.
- Kohat Cement Company Ltd. - Pakistan
- Meralco Power Generation, Philippines
- Savvy Resources Ltd - HongKong
- Global Green Power PLC Corporation, Philippines
- Coal and Oil Company - UAE
- Asmin Koalindo Tuhup - Indonesia
- Grasim Industreis Ltd - India
- Barasentosa Lestari - Indonesia
- Indonesian Coal Mining Association
- Thiess Contractors Indonesia
- Samtan Co., Ltd - South Korea
- Gujarat Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- Pipit Mutiara Jaya. PT, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Therma Luzon, Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Intertek Mineral Services - Indonesia
- Kaltim Prima Coal - Indonesia
- Siam City Cement PLC, Thailand
- Goldman Sachs - Singapore
- Alfred C Toepfer International GmbH - Germany
- CIMB Investment Bank - Malaysia
- Billiton Holdings Pty Ltd - Australia
- Globalindo Alam Lestari - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Ministry of Mines - Canada
- Aboitiz Power Corporation - Philippines
- ICICI Bank Limited - India
- Trasteel International SA, Italy
- Dalmia Cement Bharat India
- Indo Tambangraya Megah - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- CNBM International Corporation - China
- Metalloyd Limited - United Kingdom
- Jaiprakash Power Ventures ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Marubeni Corporation - India
- Vedanta Resources Plc - India
- Parliament of New Zealand
- Kumho Petrochemical, South Korea
- PowerSource Philippines DevCo
- Bahari Cakrawala Sebuku - Indonesia
- Romanian Commodities Exchange
- Makarim & Taira - Indonesia
- OPG Power Generation Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Australian Commodity Traders Exchange
- Jorong Barutama Greston.PT - Indonesia
- Karaikal Port Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Bangladesh Power Developement Board
- Independent Power Producers Association of India
- Carbofer General Trading SA - India
- Australian Coal Association
- Toyota Tsusho Corporation, Japan
- International Coal Ventures Pvt Ltd - India
- White Energy Company Limited
- Eastern Coal Council - USA
- Indian Energy Exchange, India
- Bhoruka Overseas - Indonesia
- IHS Mccloskey Coal Group - USA
- Bukit Baiduri Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Star Paper Mills Limited - India
- TeaM Sual Corporation - Philippines
- San Jose City I Power Corp, Philippines
- Sakthi Sugars Limited - India
- Electricity Authority, New Zealand
- Larsen & Toubro Limited - India
- Merrill Lynch Commodities Europe
- Miang Besar Coal Terminal - Indonesia
- Power Finance Corporation Ltd., India
- Sinarmas Energy and Mining - Indonesia
- South Luzon Thermal Energy Corporation
- Semirara Mining and Power Corporation, Philippines
- Central Java Power - Indonesia
- Sindya Power Generating Company Private Ltd
- SN Aboitiz Power Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Cement Manufacturers Association - India
- Mercator Lines Limited - India
- Sical Logistics Limited - India
- Energy Link Ltd, New Zealand
- Aditya Birla Group - India
- Wilmar Investment Holdings
- Deloitte Consulting - India
- Mintek Dendrill Indonesia
- Madhucon Powers Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Global Business Power Corporation, Philippines
- Baramulti Group, Indonesia
- SMG Consultants - Indonesia
- Mjunction Services Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vizag Seaport Private Limited - India
- Oldendorff Carriers - Singapore
- Petron Corporation, Philippines
- Ministry of Transport, Egypt
- Semirara Mining Corp, Philippines
- Ambuja Cements Ltd - India
- Bharathi Cement Corporation - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
|
| |
| |
|
