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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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- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Australian Commodity Traders Exchange
- The Treasury - Australian Government
- Kohat Cement Company Ltd. - Pakistan
- Energy Link Ltd, New Zealand
- Directorate Of Revenue Intelligence - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mercator Lines Limited - India
- Independent Power Producers Association of India
- Bukit Makmur.PT - Indonesia
- Mintek Dendrill Indonesia
- CNBM International Corporation - China
- Sojitz Corporation - Japan
- Jindal Steel & Power Ltd - India
- Marubeni Corporation - India
- Bukit Asam (Persero) Tbk - Indonesia
- Iligan Light & Power Inc, Philippines
- Anglo American - United Kingdom
- Formosa Plastics Group - Taiwan
- Eastern Energy - Thailand
- Kideco Jaya Agung - Indonesia
- CIMB Investment Bank - Malaysia
- Bulk Trading Sa - Switzerland
- Bahari Cakrawala Sebuku - Indonesia
- Mercuria Energy - Indonesia
- Posco Energy - South Korea
- Goldman Sachs - Singapore
- Trasteel International SA, Italy
- Parliament of New Zealand
- Planning Commission, India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Meralco Power Generation, Philippines
- Vizag Seaport Private Limited - India
- Rio Tinto Coal - Australia
- Kalimantan Lumbung Energi - Indonesia
- Thai Mozambique Logistica
- Uttam Galva Steels Limited - India
- Karaikal Port Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- GVK Power & Infra Limited - India
- Latin American Coal - Colombia
- SMC Global Power, Philippines
- Malabar Cements Ltd - India
- Indogreen Group - Indonesia
- Gujarat Sidhee Cement - India
- India Bulls Power Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Kumho Petrochemical, South Korea
- Globalindo Alam Lestari - Indonesia
- Altura Mining Limited, Indonesia
- Xindia Steels Limited - India
- London Commodity Brokers - England
- Wilmar Investment Holdings
- Agrawal Coal Company - India
- Bhatia International Limited - India
- Economic Council, Georgia
- European Bulk Services B.V. - Netherlands
- Sinarmas Energy and Mining - Indonesia
- Intertek Mineral Services - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Barasentosa Lestari - Indonesia
- Baramulti Group, Indonesia
- Coalindo Energy - Indonesia
- Simpson Spence & Young - Indonesia
- Standard Chartered Bank - UAE
- SN Aboitiz Power Inc, Philippines
- The University of Queensland
- Semirara Mining Corp, Philippines
- Samtan Co., Ltd - South Korea
- Bhushan Steel Limited - India
- Krishnapatnam Port Company Ltd. - India
- Aboitiz Power Corporation - Philippines
- Orica Mining Services - Indonesia
- PowerSource Philippines DevCo
- Wood Mackenzie - Singapore
- Indian Oil Corporation Limited
- Star Paper Mills Limited - India
- Port Waratah Coal Services - Australia
- GAC Shipping (India) Pvt Ltd
- Karbindo Abesyapradhi - Indoneisa
- Indo Tambangraya Megah - Indonesia
- GMR Energy Limited - India
- Toyota Tsusho Corporation, Japan
- Leighton Contractors Pty Ltd - Australia
- Kartika Selabumi Mining - Indonesia
- Madhucon Powers Ltd - India
- Binh Thuan Hamico - Vietnam
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Interocean Group of Companies - India
- Semirara Mining and Power Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Central Electricity Authority - India
- Tata Chemicals Ltd - India
- Bhoruka Overseas - Indonesia
- Petron Corporation, Philippines
- Merrill Lynch Commodities Europe
- OPG Power Generation Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Indonesian Coal Mining Association
- Global Green Power PLC Corporation, Philippines
- ASAPP Information Group - India
- Deloitte Consulting - India
- Coal and Oil Company - UAE
- Energy Development Corp, Philippines
- Thiess Contractors Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Sree Jayajothi Cements Limited - India
- Neyveli Lignite Corporation Ltd, - India
- International Coal Ventures Pvt Ltd - India
- Australian Coal Association
- Indika Energy - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Essar Steel Hazira Ltd - India
- Oldendorff Carriers - Singapore
- Ministry of Mines - Canada
- Central Java Power - Indonesia
- Banpu Public Company Limited - Thailand
- Global Business Power Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- Coastal Gujarat Power Limited - India
- Tamil Nadu electricity Board
- Makarim & Taira - Indonesia
- Global Coal Blending Company Limited - Australia
- Orica Australia Pty. Ltd.
- Carbofer General Trading SA - India
- LBH Netherlands Bv - Netherlands
- Savvy Resources Ltd - HongKong
- Aditya Birla Group - India
- Timah Investasi Mineral - Indoneisa
- Rashtriya Ispat Nigam Limited - India
- Asmin Koalindo Tuhup - Indonesia
- San Jose City I Power Corp, Philippines
- Vedanta Resources Plc - India
- White Energy Company Limited
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Heidelberg Cement - Germany
- Bukit Baiduri Energy - Indonesia
- Singapore Mercantile Exchange
- VISA Power Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Kaltim Prima Coal - Indonesia
- TeaM Sual Corporation - Philippines
- Edison Trading Spa - Italy
- Riau Bara Harum - Indonesia
- Romanian Commodities Exchange
- New Zealand Coal & Carbon
- Ministry of Finance - Indonesia
- South Luzon Thermal Energy Corporation
- Salva Resources Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Jaiprakash Power Ventures ltd
- TNB Fuel Sdn Bhd - Malaysia
- Medco Energi Mining Internasional
- McConnell Dowell - Australia
- Videocon Industries ltd - India
- Gujarat Electricity Regulatory Commission - India
- Electricity Generating Authority of Thailand
- Minerals Council of Australia
- IHS Mccloskey Coal Group - USA
- Renaissance Capital - South Africa
- Dalmia Cement Bharat India
- Ministry of Transport, Egypt
- Bangladesh Power Developement Board
- Sarangani Energy Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Borneo Indobara - Indonesia
- PTC India Limited - India
- Sindya Power Generating Company Private Ltd
- Miang Besar Coal Terminal - Indonesia
- Africa Commodities Group - South Africa
- Georgia Ports Authority, United States
- Indian Energy Exchange, India
- Kapuas Tunggal Persada - Indonesia
- Larsen & Toubro Limited - India
- Sical Logistics Limited - India
- Electricity Authority, New Zealand
- Kobexindo Tractors - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Lanco Infratech Ltd - India
- Manunggal Multi Energi - Indonesia
- Grasim Industreis Ltd - India
- Bayan Resources Tbk. - Indonesia
- Ambuja Cements Ltd - India
- ICICI Bank Limited - India
- MS Steel International - UAE
- Commonwealth Bank - Australia
- Cement Manufacturers Association - India
- Metalloyd Limited - United Kingdom
- Ind-Barath Power Infra Limited - India
- Straits Asia Resources Limited - Singapore
- Jorong Barutama Greston.PT - Indonesia
- The State Trading Corporation of India Ltd
- Therma Luzon, Inc, Philippines
- Mjunction Services Limited - India
- IEA Clean Coal Centre - UK
- Pendopo Energi Batubara - Indonesia
- Eastern Coal Council - USA
- PNOC Exploration Corporation - Philippines
- Antam Resourcindo - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Bharathi Cement Corporation - India
- Siam City Cement - Thailand
- Gujarat Mineral Development Corp Ltd - India
- Parry Sugars Refinery, India
- Kepco SPC Power Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Billiton Holdings Pty Ltd - Australia
- Chamber of Mines of South Africa
- Attock Cement Pakistan Limited
- Chettinad Cement Corporation Ltd - India
- SMG Consultants - Indonesia
- Sakthi Sugars Limited - India
- Siam City Cement PLC, Thailand
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