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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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Monday, 01 October 18
A NO-DEAL BREXIT WILL UNDOUBTEDLY HAVE CONSEQUENCES FOR IMPORTERS AND EXPORTERS - KATE JONES, THE BALTIC BRIEFING
If you live in the UK, you might be finding it difficult to get away from the Brexit debate. “Hard Brexit”, “soft Brexit”, ...
Friday, 28 September 18
INDONESIA 2018 COAL OUTPUT TARGET NOW AROUND 507 MLN T - ENERGY MINISTRY : REUTERS
Indonesia has increased its 2018 coal production target to around 507 million tonnes from a previous target of 485 million tonnes, the Energy Minis ...
Friday, 28 September 18
FITCH RATINGS: METALLURGICAL COAL MINERS MAY CURB COSTS AS PRICES SLIP
Strong cost inflation in the global metallurgical coal sector suggests that miners may focus on cost controls as prices decline from their current ...
Wednesday, 26 September 18
IS YOUR CHARTER PARTY READY FOR 2020? - METTE KRONHOLM FRAENDE, BIMCO
As the deadline for the IMO’s global low-sulphur fuel requirements fast approaches, it is necessary to carefully check the bunker clauses in ...
Wednesday, 26 September 18
SHIPPING MARKET INSIGHT - GEORGE ILIOPOULOS
Despite the fact that the dry bulk SnP market saw an admittedly busy summer season, there is a noticeable slowdown in activity during the past thre ...
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- Ind-Barath Power Infra Limited - India
- Makarim & Taira - Indonesia
- South Luzon Thermal Energy Corporation
- Sarangani Energy Corporation, Philippines
- Tamil Nadu electricity Board
- Petrochimia International Co. Ltd.- Taiwan
- Intertek Mineral Services - Indonesia
- Malabar Cements Ltd - India
- Renaissance Capital - South Africa
- VISA Power Limited - India
- Bhoruka Overseas - Indonesia
- Mercator Lines Limited - India
- Kapuas Tunggal Persada - Indonesia
- IEA Clean Coal Centre - UK
- Standard Chartered Bank - UAE
- Bukit Makmur.PT - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Cement Manufacturers Association - India
- Power Finance Corporation Ltd., India
- Dalmia Cement Bharat India
- Meenaskhi Energy Private Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Sindya Power Generating Company Private Ltd
- Savvy Resources Ltd - HongKong
- Uttam Galva Steels Limited - India
- Bayan Resources Tbk. - Indonesia
- Parry Sugars Refinery, India
- Rashtriya Ispat Nigam Limited - India
- Eastern Coal Council - USA
- SMG Consultants - Indonesia
- Port Waratah Coal Services - Australia
- Coalindo Energy - Indonesia
- Grasim Industreis Ltd - India
- Independent Power Producers Association of India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Attock Cement Pakistan Limited
- European Bulk Services B.V. - Netherlands
- Carbofer General Trading SA - India
- Trasteel International SA, Italy
- Straits Asia Resources Limited - Singapore
- Mercuria Energy - Indonesia
- San Jose City I Power Corp, Philippines
- Coastal Gujarat Power Limited - India
- Jindal Steel & Power Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Parliament of New Zealand
- Semirara Mining Corp, Philippines
- Kaltim Prima Coal - Indonesia
- London Commodity Brokers - England
- Goldman Sachs - Singapore
- Directorate Of Revenue Intelligence - India
- Tata Chemicals Ltd - India
- Bulk Trading Sa - Switzerland
- Videocon Industries ltd - India
- Barasentosa Lestari - Indonesia
- Siam City Cement PLC, Thailand
- PetroVietnam Power Coal Import and Supply Company
- Economic Council, Georgia
- MS Steel International - UAE
- Larsen & Toubro Limited - India
- Pendopo Energi Batubara - Indonesia
- Ministry of Mines - Canada
- Aditya Birla Group - India
- India Bulls Power Limited - India
- Energy Link Ltd, New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- IHS Mccloskey Coal Group - USA
- Kohat Cement Company Ltd. - Pakistan
- GMR Energy Limited - India
- Edison Trading Spa - Italy
- LBH Netherlands Bv - Netherlands
- Electricity Authority, New Zealand
- Vedanta Resources Plc - India
- Indian Oil Corporation Limited
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bhushan Steel Limited - India
- Sakthi Sugars Limited - India
- Formosa Plastics Group - Taiwan
- PTC India Limited - India
- Essar Steel Hazira Ltd - India
- Price Waterhouse Coopers - Russia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Riau Bara Harum - Indonesia
- Xindia Steels Limited - India
- Kepco SPC Power Corporation, Philippines
- Medco Energi Mining Internasional
- Binh Thuan Hamico - Vietnam
- Asmin Koalindo Tuhup - Indonesia
- Aboitiz Power Corporation - Philippines
- SMC Global Power, Philippines
- Simpson Spence & Young - Indonesia
- Orica Australia Pty. Ltd.
- Gujarat Electricity Regulatory Commission - India
- Gujarat Sidhee Cement - India
- Altura Mining Limited, Indonesia
- Petron Corporation, Philippines
- Central Electricity Authority - India
- Oldendorff Carriers - Singapore
- Ministry of Finance - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Alfred C Toepfer International GmbH - Germany
- The State Trading Corporation of India Ltd
- Metalloyd Limited - United Kingdom
- Planning Commission, India
- Latin American Coal - Colombia
- Sojitz Corporation - Japan
- GVK Power & Infra Limited - India
- Semirara Mining and Power Corporation, Philippines
- ICICI Bank Limited - India
- Borneo Indobara - Indonesia
- Electricity Generating Authority of Thailand
- Global Coal Blending Company Limited - Australia
- Chettinad Cement Corporation Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Eastern Energy - Thailand
- Minerals Council of Australia
- Kobexindo Tractors - Indoneisa
- Bahari Cakrawala Sebuku - Indonesia
- Romanian Commodities Exchange
- Indian Energy Exchange, India
- New Zealand Coal & Carbon
- Baramulti Group, Indonesia
- Deloitte Consulting - India
- Bharathi Cement Corporation - India
- Manunggal Multi Energi - Indonesia
- Vizag Seaport Private Limited - India
- Australian Commodity Traders Exchange
- Therma Luzon, Inc, Philippines
- Ceylon Electricity Board - Sri Lanka
- International Coal Ventures Pvt Ltd - India
- CNBM International Corporation - China
- Australian Coal Association
- Indogreen Group - Indonesia
- Georgia Ports Authority, United States
- Merrill Lynch Commodities Europe
- Singapore Mercantile Exchange
- Ambuja Cements Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- The Treasury - Australian Government
- Heidelberg Cement - Germany
- Rio Tinto Coal - Australia
- Posco Energy - South Korea
- Maheswari Brothers Coal Limited - India
- Timah Investasi Mineral - Indoneisa
- Energy Development Corp, Philippines
- Salva Resources Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Miang Besar Coal Terminal - Indonesia
- Thai Mozambique Logistica
- Interocean Group of Companies - India
- SN Aboitiz Power Inc, Philippines
- Anglo American - United Kingdom
- Marubeni Corporation - India
- Global Green Power PLC Corporation, Philippines
- The University of Queensland
- Mintek Dendrill Indonesia
- Samtan Co., Ltd - South Korea
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Toyota Tsusho Corporation, Japan
- Siam City Cement - Thailand
- PNOC Exploration Corporation - Philippines
- PowerSource Philippines DevCo
- Kumho Petrochemical, South Korea
- Central Java Power - Indonesia
- CIMB Investment Bank - Malaysia
- Indonesian Coal Mining Association
- Pipit Mutiara Jaya. PT, Indonesia
- Karaikal Port Pvt Ltd - India
- Thiess Contractors Indonesia
- GAC Shipping (India) Pvt Ltd
- Leighton Contractors Pty Ltd - Australia
- Antam Resourcindo - Indonesia
- Kartika Selabumi Mining - Indonesia
- Commonwealth Bank - Australia
- Coal and Oil Company - UAE
- Directorate General of MIneral and Coal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- TeaM Sual Corporation - Philippines
- Orica Mining Services - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Holcim Trading Pte Ltd - Singapore
- ASAPP Information Group - India
- Karbindo Abesyapradhi - Indoneisa
- Mjunction Services Limited - India
- Krishnapatnam Port Company Ltd. - India
- Chamber of Mines of South Africa
- Wood Mackenzie - Singapore
- Ministry of Transport, Egypt
- Maharashtra Electricity Regulatory Commission - India
- Jaiprakash Power Ventures ltd
- Star Paper Mills Limited - India
- Agrawal Coal Company - India
- Cigading International Bulk Terminal - Indonesia
- White Energy Company Limited
- Iligan Light & Power Inc, Philippines
- Indika Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- Sinarmas Energy and Mining - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Africa Commodities Group - South Africa
- Meralco Power Generation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- OPG Power Generation Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Sical Logistics Limited - India
- Wilmar Investment Holdings
- Lanco Infratech Ltd - India
- Global Business Power Corporation, Philippines
- Bhatia International Limited - India
- Banpu Public Company Limited - Thailand
- McConnell Dowell - Australia
- Bangladesh Power Developement Board
- Kideco Jaya Agung - Indonesia
- Sree Jayajothi Cements Limited - India
- Madhucon Powers Ltd - India
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