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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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Saturday, 06 February 10
COAL MINISTRY SEEKS CUT IN IMPORT DUTY
The coal ministry wants the finance ministry to reduce the 5.1% import duty on thermal coal and continue with the existing zero import duty on cokin ...
Friday, 05 February 10
IN 2010, CHINA COAL OUTPUT TO REACH AROUND 3.3BLN T
It is expected that China's coal production in 2010 will reach around 3.3bln tons. It is predicted that in the first quarter of 2010, the tight coa ...
Thursday, 04 February 10
INDIA REMAINS FIRM - FEARNRESEARCH
CHARTERING - DRY BULK
Handy
The BSI has continued it´s downward movement for 2 weeks now.Nevertheless activity in the atlantic remains bu ...
Thursday, 04 February 10
INFRASTRUCTURE DEVELOPMENT & INFRASTRUCTURE ASIA 2010
ASIA-PACIFIC MINISTERIAL CONFERENCE ON PUBLIC-PRIVATE PARTNERSHIPS FOR INFRASTRUCTURE DEVELOPMENT & INFRASTRUCTURE ASIA 2010
IPFA TO JOIN INF ...
Thursday, 04 February 10
INDIA`S APPETITE FOR COAL EXPECTED TO RISE SHARPLY
Coal powers more than half of India's electricity plants and demand for the commodity is expected to rise sharply as the third-largest Asian econom ...
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- New Zealand Coal & Carbon
- Minerals Council of Australia
- India Bulls Power Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mintek Dendrill Indonesia
- Timah Investasi Mineral - Indoneisa
- Energy Link Ltd, New Zealand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Thiess Contractors Indonesia
- Global Business Power Corporation, Philippines
- The University of Queensland
- SN Aboitiz Power Inc, Philippines
- Eastern Energy - Thailand
- Heidelberg Cement - Germany
- Bhushan Steel Limited - India
- GMR Energy Limited - India
- Georgia Ports Authority, United States
- Wood Mackenzie - Singapore
- South Luzon Thermal Energy Corporation
- PTC India Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Global Green Power PLC Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Xindia Steels Limited - India
- Alfred C Toepfer International GmbH - Germany
- Barasentosa Lestari - Indonesia
- Price Waterhouse Coopers - Russia
- Meralco Power Generation, Philippines
- Rio Tinto Coal - Australia
- Indonesian Coal Mining Association
- Central Java Power - Indonesia
- Parry Sugars Refinery, India
- Vedanta Resources Plc - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Maheswari Brothers Coal Limited - India
- Karaikal Port Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Toyota Tsusho Corporation, Japan
- CNBM International Corporation - China
- Metalloyd Limited - United Kingdom
- Krishnapatnam Port Company Ltd. - India
- Billiton Holdings Pty Ltd - Australia
- Energy Development Corp, Philippines
- Chamber of Mines of South Africa
- Attock Cement Pakistan Limited
- Sojitz Corporation - Japan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ministry of Mines - Canada
- Tata Chemicals Ltd - India
- Lanco Infratech Ltd - India
- Jaiprakash Power Ventures ltd
- Kobexindo Tractors - Indoneisa
- The Treasury - Australian Government
- Agrawal Coal Company - India
- IEA Clean Coal Centre - UK
- GN Power Mariveles Coal Plant, Philippines
- TeaM Sual Corporation - Philippines
- Carbofer General Trading SA - India
- Latin American Coal - Colombia
- Africa Commodities Group - South Africa
- Savvy Resources Ltd - HongKong
- Singapore Mercantile Exchange
- Binh Thuan Hamico - Vietnam
- Electricity Authority, New Zealand
- Electricity Generating Authority of Thailand
- Edison Trading Spa - Italy
- Madhucon Powers Ltd - India
- Baramulti Group, Indonesia
- Sree Jayajothi Cements Limited - India
- Thai Mozambique Logistica
- Gujarat Electricity Regulatory Commission - India
- IHS Mccloskey Coal Group - USA
- Globalindo Alam Lestari - Indonesia
- LBH Netherlands Bv - Netherlands
- White Energy Company Limited
- Parliament of New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- The State Trading Corporation of India Ltd
- Australian Coal Association
- Posco Energy - South Korea
- Miang Besar Coal Terminal - Indonesia
- Intertek Mineral Services - Indonesia
- Vizag Seaport Private Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Indian Oil Corporation Limited
- Jindal Steel & Power Ltd - India
- Sindya Power Generating Company Private Ltd
- Aditya Birla Group - India
- AsiaOL BioFuels Corp., Philippines
- San Jose City I Power Corp, Philippines
- Bulk Trading Sa - Switzerland
- Pendopo Energi Batubara - Indonesia
- Ind-Barath Power Infra Limited - India
- Marubeni Corporation - India
- Sakthi Sugars Limited - India
- Romanian Commodities Exchange
- Holcim Trading Pte Ltd - Singapore
- Uttam Galva Steels Limited - India
- Bayan Resources Tbk. - Indonesia
- Essar Steel Hazira Ltd - India
- Kartika Selabumi Mining - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Standard Chartered Bank - UAE
- Semirara Mining and Power Corporation, Philippines
- Ministry of Finance - Indonesia
- Bhatia International Limited - India
- Salva Resources Pvt Ltd - India
- Videocon Industries ltd - India
- Orica Australia Pty. Ltd.
- London Commodity Brokers - England
- Ambuja Cements Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Grasim Industreis Ltd - India
- Wilmar Investment Holdings
- Samtan Co., Ltd - South Korea
- Coal and Oil Company - UAE
- Coalindo Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Ministry of Transport, Egypt
- Trasteel International SA, Italy
- Bharathi Cement Corporation - India
- McConnell Dowell - Australia
- Power Finance Corporation Ltd., India
- Renaissance Capital - South Africa
- Bangladesh Power Developement Board
- Mercuria Energy - Indonesia
- Sarangani Energy Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- Star Paper Mills Limited - India
- Sical Logistics Limited - India
- CIMB Investment Bank - Malaysia
- Straits Asia Resources Limited - Singapore
- Global Coal Blending Company Limited - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Larsen & Toubro Limited - India
- Eastern Coal Council - USA
- Makarim & Taira - Indonesia
- Commonwealth Bank - Australia
- Iligan Light & Power Inc, Philippines
- Indika Energy - Indonesia
- Anglo American - United Kingdom
- Directorate General of MIneral and Coal - Indonesia
- Orica Mining Services - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Economic Council, Georgia
- Kepco SPC Power Corporation, Philippines
- PowerSource Philippines DevCo
- Kumho Petrochemical, South Korea
- Interocean Group of Companies - India
- Bukit Makmur.PT - Indonesia
- Bhoruka Overseas - Indonesia
- Tamil Nadu electricity Board
- Mercator Lines Limited - India
- Coastal Gujarat Power Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Indian Energy Exchange, India
- Aboitiz Power Corporation - Philippines
- Central Electricity Authority - India
- Antam Resourcindo - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Chettinad Cement Corporation Ltd - India
- Altura Mining Limited, Indonesia
- Therma Luzon, Inc, Philippines
- Simpson Spence & Young - Indonesia
- ASAPP Information Group - India
- Malabar Cements Ltd - India
- Manunggal Multi Energi - Indonesia
- Borneo Indobara - Indonesia
- Deloitte Consulting - India
- Banpu Public Company Limited - Thailand
- Cigading International Bulk Terminal - Indonesia
- Siam City Cement - Thailand
- Oldendorff Carriers - Singapore
- Meenaskhi Energy Private Limited - India
- European Bulk Services B.V. - Netherlands
- International Coal Ventures Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Goldman Sachs - Singapore
- SMC Global Power, Philippines
- Merrill Lynch Commodities Europe
- GAC Shipping (India) Pvt Ltd
- Siam City Cement PLC, Thailand
- Mjunction Services Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Indogreen Group - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- ICICI Bank Limited - India
- Kaltim Prima Coal - Indonesia
- GVK Power & Infra Limited - India
- SMG Consultants - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Port Waratah Coal Services - Australia
- Petron Corporation, Philippines
- Australian Commodity Traders Exchange
- MS Steel International - UAE
- Leighton Contractors Pty Ltd - Australia
- Gujarat Sidhee Cement - India
- Jorong Barutama Greston.PT - Indonesia
- Directorate Of Revenue Intelligence - India
- Independent Power Producers Association of India
- Cement Manufacturers Association - India
- Pipit Mutiara Jaya. PT, Indonesia
- Planning Commission, India
- Semirara Mining Corp, Philippines
- Formosa Plastics Group - Taiwan
- Kapuas Tunggal Persada - Indonesia
- VISA Power Limited - India
- Riau Bara Harum - Indonesia
- OPG Power Generation Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Dalmia Cement Bharat India
- Medco Energi Mining Internasional
- TNB Fuel Sdn Bhd - Malaysia
- Indo Tambangraya Megah - Indonesia
- Karbindo Abesyapradhi - Indoneisa
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