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Friday, 23 October 09
CIL PRICE HIKE LIKELY TO PUSH POWER RATES UP
 Business-Standard reported that, May squeeze cement companies’ margins, but the steel sector is unlikely to be affected much.
The upward revision of coal prices by government-owned Coal India Limited (CIL), which took place last week, is likely to have a divergent impact on the fossil fuel’s primary consumers such as cement, power and steel sectors. While cement makers’ margins will be under pressure, power producers will make a move to pass on the increased burden to consumers.The three sectors account for about 72 per cent of the total coal demand in the country.
On October 16, CIL increased the price of coal from Eastern Coalfields (ECL) and Bharat Coking Coal (BCCL) by 15 per cent, while all other subsidiary companies were permitted a hike of 10 per cent. This price increase is expected to swell CIL’s net profit by approximately Rs 2,000 crore this financial year and by about Rs 4,100 crore in the following year.
However, for the consuming sectors, especially the cement industry, the increase in coal prices will squeeze profit margins at a time when prices are already low due to rapid capacity augmentation.
Despite the fact that coal accounted for around two-thirds of the power and fuel cost, and 20 per cent of the total cost for cement manufacturers, firms would be unable to pass on the hike in coal prices to end users due to the current business environment, a report by Crisil Research suggested.
“The recent coal price hike will increase the cost of cement by Rs 3-4 a bag. However, this has been absorbed by manufacturers in the short-term. In the long run, though, if conditions are right, we could pass on the cost,” Cement Manufacturers Association President and Shree Cement Managing Director HM Bangur said. For the power sector, though, the impact of the upward revision of coal prices would be neutral, as the rise in cost of fuel would be passed on by the generators.
On an average, tariffs of power plants using domestic coal as fuel are expected to increase by 3-4 per cent. In rupee terms, the tariffs are expected to increase on an average by Rs 0.06 a unit. The rise is expected to increase the tariffs for final power consumers as the price hike will be passed on, the Crisil report further stated.
With the respective regulatory authorities of each state overseeing power tariffs, generators would first have to ascertain the increase in input costs and then approach the regulator for approval.
However, with the coal mixture of each generator differing, the choice being between CIL coal and that of the imported variety, it would take sometime before power utilities decide on the actual magnitude of the increase in tariff. “But 100 per cent, we will have to pass on the cost,” an official from the RPG’s power utility CESC said.
As for the steel industry, the Crisil report indicated that the coal price hike by CIL was not expected to have a significant impact on the steel industry as non-coking coal, which was primarily used by the sector, did not account for a significant portion of the total cost of steel manufacturing, except for steel made through the sponge iron route. Moreover, the dependence of domestic steel producers on CIL is only 25-35 per cent of their total requirement due to the availability of captive mines and imports. But Visa Steel Chairman and President of the Indian Chamber of Commerce Vishambhar Saran said the ex-pit head prices of CIL were already comparable to international prices, barring the freight factor cost. “The cost of setting-up a plant is higher if one is to use domestically available coal as compared to imported coal. This is because the former is of inferior quality and consequently extra costs such as ash disposal must be counted into the total project cost,” he added.
Source: Business-Standard
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Wednesday, 20 May 09
CIL MAY URGE NEW GOVERNMENT TO HIKE COAL PRICE - STEELGURU
BL reported that soon after assuming office the new government may be faced with a proposal for an increase in prices of coal by Coal India Limited ...
Wednesday, 20 May 09
S.KOREA COAL IMPORTS IN APRIL DOWN 22 PCT Y/Y - REUTERS
South Korea's imports of heating coal in April fell 22 percent from a year earlier on bearish demand from domestic utilities, industry data showed ...
Wednesday, 20 May 09
THE WORLD'S TOP COAL TRADING COMPANIES - REUTERS
The international physical steam coal market has become increasingly liquid and tradeable during the past five years.
Physical global seaborne co ...
Wednesday, 20 May 09
SHIPPING INDEX RISES TO 7-MONTH HIGH AS CHINESE DEMAND ADVANCES - BLOOMBERG
The Baltic Dry Index, a measure of shipping costs for commodities, rose to a seven-month high in London on accelerating Chinese demand for iron ore. ...
Saturday, 16 May 09
FREIGHT MARKET HAS BEEN EXTREMELY BUOYANT - VISTAAR SINGAPORE
COALspot.com (Singapore): The week saw the BDI rally continuing and the market freight market has been extremely buoyant, VISTAAR Shipping Pte Limit ...
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- Ministry of Transport, Egypt
- Australian Commodity Traders Exchange
- Posco Energy - South Korea
- Carbofer General Trading SA - India
- Merrill Lynch Commodities Europe
- Chamber of Mines of South Africa
- Australian Coal Association
- Kaltim Prima Coal - Indonesia
- Directorate Of Revenue Intelligence - India
- Indian Oil Corporation Limited
- Binh Thuan Hamico - Vietnam
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- Central Electricity Authority - India
- Meenaskhi Energy Private Limited - India
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- Indonesian Coal Mining Association
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- Alfred C Toepfer International GmbH - Germany
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- Banpu Public Company Limited - Thailand
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- Siam City Cement PLC, Thailand
- India Bulls Power Limited - India
- Cigading International Bulk Terminal - Indonesia
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- Eastern Energy - Thailand
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- Samtan Co., Ltd - South Korea
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- Power Finance Corporation Ltd., India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
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- GN Power Mariveles Coal Plant, Philippines
- Oldendorff Carriers - Singapore
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- The University of Queensland
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- Global Green Power PLC Corporation, Philippines
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- Deloitte Consulting - India
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- Bayan Resources Tbk. - Indonesia
- Ministry of Finance - Indonesia
- White Energy Company Limited
- Wilmar Investment Holdings
- Holcim Trading Pte Ltd - Singapore
- Bangladesh Power Developement Board
- Mercuria Energy - Indonesia
- Karaikal Port Pvt Ltd - India
- Agrawal Coal Company - India
- Kideco Jaya Agung - Indonesia
- Aboitiz Power Corporation - Philippines
- Billiton Holdings Pty Ltd - Australia
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- Global Coal Blending Company Limited - Australia
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- Minerals Council of Australia
- San Jose City I Power Corp, Philippines
- Siam City Cement - Thailand
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- Straits Asia Resources Limited - Singapore
- Maheswari Brothers Coal Limited - India
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- Toyota Tsusho Corporation, Japan
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- Globalindo Alam Lestari - Indonesia
- Sical Logistics Limited - India
- Chettinad Cement Corporation Ltd - India
- IHS Mccloskey Coal Group - USA
- ASAPP Information Group - India
- Meralco Power Generation, Philippines
- Kartika Selabumi Mining - Indonesia
- Ministry of Mines - Canada
- Energy Link Ltd, New Zealand
- Central Java Power - Indonesia
- Indian Energy Exchange, India
- Sree Jayajothi Cements Limited - India
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- Sarangani Energy Corporation, Philippines
- Antam Resourcindo - Indonesia
- Goldman Sachs - Singapore
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- Electricity Generating Authority of Thailand
- Essar Steel Hazira Ltd - India
- Coal and Oil Company - UAE
- Rashtriya Ispat Nigam Limited - India
- Interocean Group of Companies - India
- Kumho Petrochemical, South Korea
- Anglo American - United Kingdom
- PetroVietnam Power Coal Import and Supply Company
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- Dalmia Cement Bharat India
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- Price Waterhouse Coopers - Russia
- Medco Energi Mining Internasional
- IEA Clean Coal Centre - UK
- Bulk Trading Sa - Switzerland
- Therma Luzon, Inc, Philippines
- Commonwealth Bank - Australia
- Asmin Koalindo Tuhup - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- LBH Netherlands Bv - Netherlands
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- Africa Commodities Group - South Africa
- Kepco SPC Power Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bahari Cakrawala Sebuku - Indonesia
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- Ambuja Cements Ltd - India
- The State Trading Corporation of India Ltd
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- Aditya Birla Group - India
- Madhucon Powers Ltd - India
- Eastern Coal Council - USA
- Kohat Cement Company Ltd. - Pakistan
- Petron Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Pipit Mutiara Jaya. PT, Indonesia
- PNOC Exploration Corporation - Philippines
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- Economic Council, Georgia
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- CIMB Investment Bank - Malaysia
- Miang Besar Coal Terminal - Indonesia
- Marubeni Corporation - India
- Mjunction Services Limited - India
- Sakthi Sugars Limited - India
- Barasentosa Lestari - Indonesia
- Cement Manufacturers Association - India
- The Treasury - Australian Government
- Baramulti Group, Indonesia
- Leighton Contractors Pty Ltd - Australia
- Georgia Ports Authority, United States
- AsiaOL BioFuels Corp., Philippines
- Bukit Baiduri Energy - Indonesia
- Parliament of New Zealand
- Directorate General of MIneral and Coal - Indonesia
- Malabar Cements Ltd - India
- Indo Tambangraya Megah - Indonesia
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- Edison Trading Spa - Italy
- Wood Mackenzie - Singapore
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- European Bulk Services B.V. - Netherlands
- Independent Power Producers Association of India
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