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Tuesday, 18 September 18
COOLING OUTLOOK FOR COAL - KATE JONES
.jpg) At a time of increasing focus on the renewables market as the world seeks to clean up its act to prevent climate change, what is the outlook like for coal? If an August report from Statistics Market Research Consulting (Stratistics MRC) is anything to go by, the answer to that question appears to be, ‘not as bad as one might fear’.
The report, Coal Industry – Global Market Outlook (2017-2026), forecasts the global coal market to grow at a compound annual growth rate of 12.5% from 2017 to 2026 — and hit $34.65m by the latter year. An enlarging manufacturing base, rising economic growth and increasing electricity demand are some of the key factors propelling the growth, according to the study, though the report did claim that price instability is restricting market enlargement. Furthermore, the world coal market accounted for $11.93m last year. Based on geography, growth in the market during 2017-2026 is anticipated for the Asia-Pacific region —several nations in the area, such as China and Japan, lack energy resources and are therefore importing to meet requirements.
The world of the product
However, this positive picture stands somewhat alone. At the end of August, it was reported that a push to lessen the development of coal mines, as well as growing investor pressure to divest from fossil fuels, is generating a mining industry division between businesses leaving the sector and companies vowing to stay in it. Banks that have reportedly brought lending for new coal mines to a halt include Deutsche Bank and the Royal Bank of Scotland, while new project spending has dropped 80%, from $10bn in 2012 to $2.2bn this year. This trend, along with a government-led campaign in China to cut supply of domestic coal to reduce pollution, has made the coal price almost double over the last three years — to trade at $113 a tonne.
But some companies are staying in the industry or enlarging their presence. For the world’s biggest miner, BHP, there is confidence in coal’s staying power.
“The world, rightly or wrongly, is going to be using a lot of thermal coal,” claimed Peter Beaven, BHP’s chief financial officer, referring to the kind of coal used in power stations. The company has no plans to sell its coal assets — and neither does the biggest producer of seaborne coal for export globally, Glencore. In fact, Glencore is in expansion mode. This year, it purchased a 49% share in a Yancoal-operated thermal coal project in New South Wales in Australia and bought Rio Tinto’s Hail Creek coal mine in Queensland, also in Australia, for $1.7bn. The company reportedly made $2bn from its coal division in H1 2018, with the business estimating that at current prices, coal will be its largest earnings driver for the full year. Macquarie Group analysts describes the organisation as “slowly stepping into the breach, quietly consolidating its position in an unpopular sub-sector of the mining industry”.
However, not all coal miners have had such good fortune. In March, Rio Tinto sold its last coal mine to EMR Capital and Adaro Energy for $2.25bn, while South32 plans on selling its South African thermal coal assets to local investors later in 2018. South32 chief executive Graham Kerr has reportedly argued that thermal coal is increasingly becoming a focus of meetings with investors.
“Every six months, they tell you they can’t invest in you,” he noted.
What’s more, coal could soon find itself eclipsed by renewables. Fitch Solutions said at the end of August that renewable energy will play an increasingly important role in powering mining operations across the globe over the coming years, while Alexa Capital co-founder Gerard Reid has said that because wind and solar power have already become less expensive than coal-fired power in many parts of the world, a renewables move could happen faster than many believe.
The mixed messages mirror the division among investors and analysts over coal: while both the Church of England Pensions Board and BMO Global Asset Management have both turned away from supporting coal, Norway’s $1tr sovereign wealth fund (which owns Glencore shares), has said it would only exclude companies “which themselves, or through entities they control, derive 30% or more of their income from thermal coal”.
Area focus
Yet, Stratistics MRC’s prediction of Asia-Pacific coal market growth resonates with other indicators for the field. BP predicted that coal would likely stay the dominant energy source in Asia as late as 2040, while the Australian Bureau of Statistics said that Australia’s coal mining industry increased capital expenditure by 20% in 2017-18 to $3.5bn. However, analysts are split on how fast the planet’s largest coal consumer, China, will move away from the commodity. According to official figures, its coal consumption went up just 0.4% last year.
However, BHP, despite feeling that coal is set to “progressively lose competitiveness to renewables on a newbuild basis in the developed world and in China”, predicts that the crossover point will not be reached until the end of the next decade and says that coal power “is expected to retain competitiveness in India and other populous emerging markets for a much-longer time”.
As for the US, it was reported at the end of last month that US President Donald Trump was pushing forward with his endeavours to revive the US coal mining sector and that the Environmental Protection Agency claimed it was planning to repeal previous president Barack Obama’s Clean Power Plan, relaxing coal-fired power plant regulation. US coal miners like Peabody will no doubt be pleased by this shift in emphasis — its shares are up by 7% in the year to date, having reportedly been boosted by President Trump’s coal-supporting efforts.
Source: The Baltic Briefing
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Wednesday, 24 October 18
MARKET INSIGHT - NASSOS SOULAKIS
Looking at 2018 SnP activity, it is evident that Greek, Chinese and North European (German and Norwegian) owners are the top buying nationalities, ...
Wednesday, 24 October 18
CHINESE POWER PLANT STOCKPILES AT HIGHEST LEVEL SINCE 2015 - JEFFREY LANDSBERG
Chinese power plant coal stockpiles have climbed to approximately 83.3 million tons as of the middle of this month, said Jeffrey Landsberg in his e ...
Tuesday, 23 October 18
WILL THE U.S. COAL DECLINE CONTINUE? - FORBES
What’s Trump’s new coal proposal?
Adding to its controversial plan to leverage federal authority to keep retiring baselo ...
Monday, 22 October 18
CONTINUED HIGH LNG PRICES; TRADE WAR IMPACT LIMITED - FITCH RATINGS
Fitch Ratings expects sustained high spot liquefied natural gas (LNG) and contract prices over the next two quarters on limited investment in LNG e ...
Monday, 22 October 18
WINTER OIL MARKET OUTLOOK - OPEC
The oil market in the winter season is generally characterized by demand for diesel, particularly in the northern hemisphere, leaving product marke ...
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- Anglo American - United Kingdom
- McConnell Dowell - Australia
- Straits Asia Resources Limited - Singapore
- Merrill Lynch Commodities Europe
- Therma Luzon, Inc, Philippines
- Trasteel International SA, Italy
- Chamber of Mines of South Africa
- ICICI Bank Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Vedanta Resources Plc - India
- Cement Manufacturers Association - India
- Kalimantan Lumbung Energi - Indonesia
- Iligan Light & Power Inc, Philippines
- GAC Shipping (India) Pvt Ltd
- Riau Bara Harum - Indonesia
- Posco Energy - South Korea
- Power Finance Corporation Ltd., India
- Sojitz Corporation - Japan
- Electricity Generating Authority of Thailand
- Independent Power Producers Association of India
- Central Electricity Authority - India
- Economic Council, Georgia
- Star Paper Mills Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sinarmas Energy and Mining - Indonesia
- MS Steel International - UAE
- TeaM Sual Corporation - Philippines
- Semirara Mining Corp, Philippines
- Gujarat Sidhee Cement - India
- Wilmar Investment Holdings
- Bhoruka Overseas - Indonesia
- Pendopo Energi Batubara - Indonesia
- Globalindo Alam Lestari - Indonesia
- Tamil Nadu electricity Board
- Lanco Infratech Ltd - India
- Simpson Spence & Young - Indonesia
- Jaiprakash Power Ventures ltd
- Xindia Steels Limited - India
- India Bulls Power Limited - India
- CNBM International Corporation - China
- Price Waterhouse Coopers - Russia
- Bulk Trading Sa - Switzerland
- Aboitiz Power Corporation - Philippines
- Uttam Galva Steels Limited - India
- Parry Sugars Refinery, India
- Indika Energy - Indonesia
- Manunggal Multi Energi - Indonesia
- Ind-Barath Power Infra Limited - India
- Indo Tambangraya Megah - Indonesia
- Wood Mackenzie - Singapore
- Orica Australia Pty. Ltd.
- The State Trading Corporation of India Ltd
- Global Green Power PLC Corporation, Philippines
- Singapore Mercantile Exchange
- PTC India Limited - India
- Global Business Power Corporation, Philippines
- Dalmia Cement Bharat India
- Krishnapatnam Port Company Ltd. - India
- LBH Netherlands Bv - Netherlands
- Kaltim Prima Coal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Directorate General of MIneral and Coal - Indonesia
- Eastern Energy - Thailand
- Ministry of Finance - Indonesia
- Meenaskhi Energy Private Limited - India
- Kapuas Tunggal Persada - Indonesia
- Kartika Selabumi Mining - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sakthi Sugars Limited - India
- IHS Mccloskey Coal Group - USA
- Kumho Petrochemical, South Korea
- Aditya Birla Group - India
- Eastern Coal Council - USA
- Africa Commodities Group - South Africa
- Chettinad Cement Corporation Ltd - India
- Energy Link Ltd, New Zealand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- Kideco Jaya Agung - Indonesia
- Ministry of Transport, Egypt
- Indian Oil Corporation Limited
- ASAPP Information Group - India
- IEA Clean Coal Centre - UK
- Global Coal Blending Company Limited - Australia
- Indonesian Coal Mining Association
- European Bulk Services B.V. - Netherlands
- Sree Jayajothi Cements Limited - India
- Siam City Cement PLC, Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Bahari Cakrawala Sebuku - Indonesia
- The Treasury - Australian Government
- Sarangani Energy Corporation, Philippines
- Mercator Lines Limited - India
- Interocean Group of Companies - India
- Parliament of New Zealand
- Romanian Commodities Exchange
- Formosa Plastics Group - Taiwan
- Edison Trading Spa - Italy
- TNB Fuel Sdn Bhd - Malaysia
- Rashtriya Ispat Nigam Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- SMC Global Power, Philippines
- Sical Logistics Limited - India
- Attock Cement Pakistan Limited
- Miang Besar Coal Terminal - Indonesia
- Savvy Resources Ltd - HongKong
- Electricity Authority, New Zealand
- Neyveli Lignite Corporation Ltd, - India
- Rio Tinto Coal - Australia
- Borneo Indobara - Indonesia
- Altura Mining Limited, Indonesia
- Ceylon Electricity Board - Sri Lanka
- SMG Consultants - Indonesia
- Toyota Tsusho Corporation, Japan
- Bhushan Steel Limited - India
- Kobexindo Tractors - Indoneisa
- Petron Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Heidelberg Cement - Germany
- Makarim & Taira - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Holcim Trading Pte Ltd - Singapore
- White Energy Company Limited
- Georgia Ports Authority, United States
- Alfred C Toepfer International GmbH - Germany
- Carbofer General Trading SA - India
- Larsen & Toubro Limited - India
- Videocon Industries ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Madhucon Powers Ltd - India
- Bukit Makmur.PT - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Billiton Holdings Pty Ltd - Australia
- Meralco Power Generation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Planning Commission, India
- Latin American Coal - Colombia
- Marubeni Corporation - India
- Timah Investasi Mineral - Indoneisa
- Renaissance Capital - South Africa
- Indian Energy Exchange, India
- Mjunction Services Limited - India
- Coalindo Energy - Indonesia
- Binh Thuan Hamico - Vietnam
- Maheswari Brothers Coal Limited - India
- Jindal Steel & Power Ltd - India
- Central Java Power - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Ambuja Cements Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Salva Resources Pvt Ltd - India
- New Zealand Coal & Carbon
- Semirara Mining and Power Corporation, Philippines
- Karaikal Port Pvt Ltd - India
- VISA Power Limited - India
- Mintek Dendrill Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Vijayanagar Sugar Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Malabar Cements Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Agrawal Coal Company - India
- Siam City Cement - Thailand
- GMR Energy Limited - India
- Metalloyd Limited - United Kingdom
- Bhatia International Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Medco Energi Mining Internasional
- GVK Power & Infra Limited - India
- Cigading International Bulk Terminal - Indonesia
- Australian Commodity Traders Exchange
- San Jose City I Power Corp, Philippines
- Sindya Power Generating Company Private Ltd
- Kepco SPC Power Corporation, Philippines
- Thai Mozambique Logistica
- CIMB Investment Bank - Malaysia
- Ministry of Mines - Canada
- Directorate Of Revenue Intelligence - India
- PowerSource Philippines DevCo
- Intertek Mineral Services - Indonesia
- Banpu Public Company Limited - Thailand
- Oldendorff Carriers - Singapore
- International Coal Ventures Pvt Ltd - India
- Barasentosa Lestari - Indonesia
- Antam Resourcindo - Indonesia
- Energy Development Corp, Philippines
- PNOC Exploration Corporation - Philippines
- Mercuria Energy - Indonesia
- Bukit Baiduri Energy - Indonesia
- Indogreen Group - Indonesia
- Tata Chemicals Ltd - India
- Thiess Contractors Indonesia
- Standard Chartered Bank - UAE
- Bharathi Cement Corporation - India
- Orica Mining Services - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Grasim Industreis Ltd - India
- London Commodity Brokers - England
- Minerals Council of Australia
- Goldman Sachs - Singapore
- Deloitte Consulting - India
- Pipit Mutiara Jaya. PT, Indonesia
- Australian Coal Association
- Vizag Seaport Private Limited - India
- OPG Power Generation Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- Commonwealth Bank - Australia
- Coal and Oil Company - UAE
- Port Waratah Coal Services - Australia
- Essar Steel Hazira Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Bangladesh Power Developement Board
- Baramulti Group, Indonesia
- The University of Queensland
- South Luzon Thermal Energy Corporation
- Coastal Gujarat Power Limited - India
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