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Thursday, 04 March 10
GLOBAL COAL PRICES GETS SUPPORT FROM EM DEMAND
 Commodity Online reported that, AP12 coal prices look well supported in 2010 thanks to positive outlook for Chinese coal demand whereas coal demand in Europe, rest of the world is shockingly low and stocks have hardly drawn despite the coldest winter in decades, according to an analysis by Bank of America- Merrill Lynch (BofAML).
Japan, by far the biggest importer of thermal coal, cut back on its appetite for coal by almost 20 million mt last year, to 117million mt. Europe took in 22 million metric tons less last year, driven particularly by Spain, Italy, the UK and France as low natural gas prices supported switching out of coal in the power sector
Last year China imported 70.4 mn mt of thermal coal, relative to outflows of 7.8 mn in 2008. China's imports will witness slowdown due to ramping up of internal proudction, according to BofAML.
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“Last year China imported 70.4 mln mt of thermal coal, relative to outflows of 7.8 mln in 2008. China's imports will witness slowdown due to ramping up of internal production” - BofAML
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Coal prices are protected to the downside by the high marginal cost of production, particularly in Russia. However, the oversupply in Europe will likely keep a lid on API2 prices near-term.
API2 front month coal increased from a low of $75/mt in mid December to $97/mt in early January, sharply outpacing other energy markets. Heavy snowstorms led to local power shortages, particularly in the South of the country.
Perhaps more importantly, a much stronger-than-expected cyclical rebound in China drove power generation growth to new highs, up 33% YoY over the past three months, helping to fuel coal demand. Other Asian countries also experienced a turn-around in electricity generation. In turn, due to the heavy snowfall and rail constraints, China resorted to seaborne coal as opposed to domestically produced material. Elsewhere, a glaringly cold winter in Europe provided some support to sentiment. Producer infrastructure constraints, particularly in Australia, South Africa and Indonesia, temporarily tightened the international coal market.
Ultimately, the 3-week rally in coal did not last and prices reversed sharply in mid January as the snowfalls in China receded and the USD strengthened. In recent weeks, front-month API2 coal traded down to $72.75/mt and has been in the $72/mt to $79/mt range. Chinese imports in January, though still at a very high level, cooled off month-on-month basis. Moreover, big European coal users, like Germany, France and the UK, recorded steep demand losses in January, at a time that they experienced the sharpest winter in decade, BofAML analysis said.
In the UK for instance, coal demand in December equalled 4.6 million mt, down from 6.3 million mt in the prior year. Preliminary data indicates that the trend continued over the past weeks.
Traditional European coal suppliers are doing what they can to manage supply to Europe. Russia has reportedly closed some mines to keep exports to Europe low. South Africa is actively diversifying away from Europe towards demand outlets in Asia Pacific. During 2009, 31% of South African exports went to India, from virtually nothing in previous years. That trend was particularly pronounced over the past months. Although in small volumes, South Africa has also been pushing material into China. More absurdly, Colombia-- who typically exports 50-60% of their coal to Europe with the balance going to the Americas--
has now detected interest in Asia.
Colombia exported small volumes to China in December to the tune of 1.5-1.7 million mt, for the first time ever. Of course, sharply lower freight rates are helping these trade flows. As we see continued supply of new Capesize vessels in 2010, freight will likely remain cheap by historical standards in the near-term. Once freight recovers, possibly at the end of this year with the cyclical demand recovery soaking up the supply in ships, these trade-flows are unlikely to be sustainable.
Europe's coal inventories remain at excessive levels at key import ports in Rotterdam and Amsterdam as supply exceeds demand. BofAML sses strong relationship between spreads in AP12 and coal inventories. Hence it is no surprise that the contango in API2 has steepened even more, with front month to front calendar year spreads at the widest since July last year , reflecting the oversupply in the European market and bulging inventories.
Coal markets in the Pacific are a lot tighter, with inventories relatively low in key coal consumers like China, India and South Korea. Meanwhile, the Newcastle coal market is trading in backwardation. Several coal mines in Australia had to declare force majeure in response to severe rainfalls on the east coast which flooded mines, while major rail lines had to close, clogging up the coal chain infrastructure. 47 vessels are currently again lining up outside Newcastle , underscoring that infrastructure problems will not go away easily, BofAML analysis said.
Overall, the outlook for emerging market coal demand remains very positive though. China is expected buy more seaborne coal as as the Chinese Renminbi is likely to be revalued by mid year. In BofAMl analysis, a CNY revaluation is undoubtedly positive for global thermal coal prices. Other EMs likeMexico and Turkey are sharply ramping up coal imports. India continues to suffer from a negative coal balance and will have to rely on the seaborne market for supplies. On a medium-term horizon, we believe that global seaborne coal prices have immense upside from the current level given the growth in coal-fired generation capacity.
Source:Commodity Online - By Madhurima R S
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Monday, 08 March 10
CHINA SHIPPING TO CARRY MORE COAL FOR SHENHUA
Hellenic Shipping News reported that, China Shipping (Group) Company will expect to ship 40 million tons of coal for Shenhua Group in 2010, Li Shaod ...
Sunday, 07 March 10
SHIPS WERE FIXED AT AROUND US$ 16,000 PER DAY FOR TRIP VIA INDONESIA TO INDIA - CAPT. REDDY
COALspot.com: The freight market was quite buoyant this week and BDI was up by 18 pct . The Cape index up by 23.60 pct and Panamax index was up by 1 ...
Saturday, 06 March 10
ESSAR TO BUY US COAL FIRM FOR $550-600 MN
Business-Standard reported that, the Essar Group is close to buying Trinity Coal, one of the top 10 coal producers in the US, in a deal worth $550-6 ...
Friday, 05 March 10
KARNATAKA POWER SEEKS 900,000 TONS STEAMING COAL OVER 9 MONTHS
Bloomberg reported that, Karnataka Power Corp., an Indian electricity generator, is seeking to import 900,000 metric tons of steaming coal over nine ...
Friday, 05 March 10
COAL RALLY ON CHINESE DEMAND SPARKS $59 ESTIMATES
Bloomberg reportd that, A rally that has boosted coal prices 21 percent from their lows last year may have further to go as the coldest U.S. winter ...
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- Parliament of New Zealand
- Sree Jayajothi Cements Limited - India
- Price Waterhouse Coopers - Russia
- Central Java Power - Indonesia
- Manunggal Multi Energi - Indonesia
- Global Business Power Corporation, Philippines
- Trasteel International SA, Italy
- GAC Shipping (India) Pvt Ltd
- Globalindo Alam Lestari - Indonesia
- Simpson Spence & Young - Indonesia
- Carbofer General Trading SA - India
- Interocean Group of Companies - India
- SN Aboitiz Power Inc, Philippines
- Kepco SPC Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Standard Chartered Bank - UAE
- Eastern Coal Council - USA
- Goldman Sachs - Singapore
- Bharathi Cement Corporation - India
- Eastern Energy - Thailand
- AsiaOL BioFuels Corp., Philippines
- Timah Investasi Mineral - Indoneisa
- Siam City Cement - Thailand
- Power Finance Corporation Ltd., India
- GN Power Mariveles Coal Plant, Philippines
- Mjunction Services Limited - India
- Kapuas Tunggal Persada - Indonesia
- Global Green Power PLC Corporation, Philippines
- Tamil Nadu electricity Board
- Bukit Asam (Persero) Tbk - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- VISA Power Limited - India
- Cigading International Bulk Terminal - Indonesia
- The State Trading Corporation of India Ltd
- Barasentosa Lestari - Indonesia
- India Bulls Power Limited - India
- Edison Trading Spa - Italy
- Sindya Power Generating Company Private Ltd
- Maharashtra Electricity Regulatory Commission - India
- Sinarmas Energy and Mining - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Madhucon Powers Ltd - India
- Karaikal Port Pvt Ltd - India
- Xindia Steels Limited - India
- Mercator Lines Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Formosa Plastics Group - Taiwan
- Petrochimia International Co. Ltd.- Taiwan
- Ministry of Finance - Indonesia
- Minerals Council of Australia
- Kideco Jaya Agung - Indonesia
- Electricity Authority, New Zealand
- Australian Commodity Traders Exchange
- Singapore Mercantile Exchange
- Baramulti Group, Indonesia
- Oldendorff Carriers - Singapore
- South Luzon Thermal Energy Corporation
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Savvy Resources Ltd - HongKong
- Sarangani Energy Corporation, Philippines
- Agrawal Coal Company - India
- Indian Oil Corporation Limited
- Wood Mackenzie - Singapore
- Australian Coal Association
- Bayan Resources Tbk. - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Borneo Indobara - Indonesia
- Marubeni Corporation - India
- Thiess Contractors Indonesia
- Star Paper Mills Limited - India
- ICICI Bank Limited - India
- Ind-Barath Power Infra Limited - India
- Riau Bara Harum - Indonesia
- Tata Chemicals Ltd - India
- SMC Global Power, Philippines
- Bulk Trading Sa - Switzerland
- GVK Power & Infra Limited - India
- Bhatia International Limited - India
- Ministry of Mines - Canada
- Intertek Mineral Services - Indonesia
- Merrill Lynch Commodities Europe
- MS Steel International - UAE
- Kohat Cement Company Ltd. - Pakistan
- Indogreen Group - Indonesia
- Planning Commission, India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Renaissance Capital - South Africa
- Semirara Mining Corp, Philippines
- Neyveli Lignite Corporation Ltd, - India
- Bhushan Steel Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Straits Asia Resources Limited - Singapore
- Petron Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Chettinad Cement Corporation Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Kobexindo Tractors - Indoneisa
- McConnell Dowell - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Kaltim Prima Coal - Indonesia
- Economic Council, Georgia
- Asmin Koalindo Tuhup - Indonesia
- San Jose City I Power Corp, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Posco Energy - South Korea
- Sakthi Sugars Limited - India
- Vizag Seaport Private Limited - India
- Rio Tinto Coal - Australia
- IHS Mccloskey Coal Group - USA
- London Commodity Brokers - England
- Bhoruka Overseas - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- New Zealand Coal & Carbon
- Uttam Galva Steels Limited - India
- TeaM Sual Corporation - Philippines
- Aboitiz Power Corporation - Philippines
- Banpu Public Company Limited - Thailand
- Ambuja Cements Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dalmia Cement Bharat India
- Toyota Tsusho Corporation, Japan
- Bukit Baiduri Energy - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Essar Steel Hazira Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Energy Development Corp, Philippines
- Coalindo Energy - Indonesia
- CIMB Investment Bank - Malaysia
- Orica Mining Services - Indonesia
- PNOC Exploration Corporation - Philippines
- Billiton Holdings Pty Ltd - Australia
- Makarim & Taira - Indonesia
- IEA Clean Coal Centre - UK
- Aditya Birla Group - India
- Parry Sugars Refinery, India
- Africa Commodities Group - South Africa
- Gujarat Sidhee Cement - India
- SMG Consultants - Indonesia
- Georgia Ports Authority, United States
- Gujarat Electricity Regulatory Commission - India
- The University of Queensland
- Directorate Of Revenue Intelligence - India
- Maheswari Brothers Coal Limited - India
- Latin American Coal - Colombia
- Lanco Infratech Ltd - India
- Central Electricity Authority - India
- Jaiprakash Power Ventures ltd
- Anglo American - United Kingdom
- Ministry of Transport, Egypt
- Medco Energi Mining Internasional
- Therma Luzon, Inc, Philippines
- Ceylon Electricity Board - Sri Lanka
- Coastal Gujarat Power Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Mintek Dendrill Indonesia
- Independent Power Producers Association of India
- Orica Australia Pty. Ltd.
- Karbindo Abesyapradhi - Indoneisa
- LBH Netherlands Bv - Netherlands
- Leighton Contractors Pty Ltd - Australia
- Global Coal Blending Company Limited - Australia
- Holcim Trading Pte Ltd - Singapore
- PowerSource Philippines DevCo
- Bukit Makmur.PT - Indonesia
- Videocon Industries ltd - India
- CNBM International Corporation - China
- Wilmar Investment Holdings
- Port Waratah Coal Services - Australia
- Indo Tambangraya Megah - Indonesia
- Bangladesh Power Developement Board
- Binh Thuan Hamico - Vietnam
- Indika Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Pipit Mutiara Jaya. PT, Indonesia
- Miang Besar Coal Terminal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Romanian Commodities Exchange
- Salva Resources Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Meenaskhi Energy Private Limited - India
- White Energy Company Limited
- Vedanta Resources Plc - India
- PTC India Limited - India
- Coal and Oil Company - UAE
- GMR Energy Limited - India
- Sical Logistics Limited - India
- Commonwealth Bank - Australia
- European Bulk Services B.V. - Netherlands
- Deloitte Consulting - India
- The Treasury - Australian Government
- Malabar Cements Ltd - India
- Antam Resourcindo - Indonesia
- ASAPP Information Group - India
- OPG Power Generation Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Attock Cement Pakistan Limited
- Heidelberg Cement - Germany
- Kumho Petrochemical, South Korea
- Siam City Cement PLC, Thailand
- Semirara Mining and Power Corporation, Philippines
- Thai Mozambique Logistica
- Jorong Barutama Greston.PT - Indonesia
- Grasim Industreis Ltd - India
- Larsen & Toubro Limited - India
- Iligan Light & Power Inc, Philippines
- Meralco Power Generation, Philippines
- Chamber of Mines of South Africa
- Altura Mining Limited, Indonesia
- Indonesian Coal Mining Association
- Cement Manufacturers Association - India
- Electricity Generating Authority of Thailand
- Energy Link Ltd, New Zealand
- Jindal Steel & Power Ltd - India
- Sojitz Corporation - Japan
- Indian Energy Exchange, India
- Metalloyd Limited - United Kingdom
- Mercuria Energy - Indonesia
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