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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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Thursday, 07 January 10
INDONESIAS COAL OUTPUT MAY RISE TO 309 MILLION TONS IN 2014 - BLOOMBERG
Indonesia’s coal production may rise to 309 million tons by 2014 from an estimated 250 million tons this year, Bambang Setiawan, director-gene ...
Wednesday, 06 January 10
RICHARDS BAY SAYS 46% OF COAL EXPORTS WENT TO EUROPE
Richards Bay Coal Terminal, through which almost all of South Africa’s coal exports are routed, said 46 percent of the coal it exported in 200 ...
Wednesday, 06 January 10
CHINA-AUSTRALIA INVESTMENT TIES SEEN IMPROVING IN 2010
Australia and China showed a united front in a bid to improve investment ties as they signed a $3-billion coal deal on Wednesday, following a rocky ...
Wednesday, 06 January 10
INVESTMENT IN MINING TO TOP $2.5B IN 2010
The government plans to invest US$2.5 billion in the mining sector, an official said Tuesday.
Bambang Setiawan, the director general of mineral r ...
Wednesday, 06 January 10
SAS 2009 COAL EXPORTS THROUGH RBCT FLAT AT 61MT
Exports through South Africa’s Richards Bay Coal Terminal (RBCT) remained flat in 2009, as the terminal faced “critical business challen ...
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- PowerSource Philippines DevCo
- Neyveli Lignite Corporation Ltd, - India
- Altura Mining Limited, Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sical Logistics Limited - India
- New Zealand Coal & Carbon
- Singapore Mercantile Exchange
- Power Finance Corporation Ltd., India
- Videocon Industries ltd - India
- Krishnapatnam Port Company Ltd. - India
- Renaissance Capital - South Africa
- Chamber of Mines of South Africa
- Indian Energy Exchange, India
- Directorate Of Revenue Intelligence - India
- ASAPP Information Group - India
- Sinarmas Energy and Mining - Indonesia
- Heidelberg Cement - Germany
- Sakthi Sugars Limited - India
- Gujarat Electricity Regulatory Commission - India
- Rashtriya Ispat Nigam Limited - India
- Larsen & Toubro Limited - India
- Jindal Steel & Power Ltd - India
- Orica Mining Services - Indonesia
- Independent Power Producers Association of India
- Indo Tambangraya Megah - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- International Coal Ventures Pvt Ltd - India
- SMC Global Power, Philippines
- Kobexindo Tractors - Indoneisa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Borneo Indobara - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Gujarat Sidhee Cement - India
- Medco Energi Mining Internasional
- Posco Energy - South Korea
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Dalmia Cement Bharat India
- Sindya Power Generating Company Private Ltd
- Commonwealth Bank - Australia
- Bhatia International Limited - India
- GMR Energy Limited - India
- Global Green Power PLC Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Eastern Coal Council - USA
- Bhoruka Overseas - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Semirara Mining and Power Corporation, Philippines
- Petron Corporation, Philippines
- Africa Commodities Group - South Africa
- Vijayanagar Sugar Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Iligan Light & Power Inc, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Cigading International Bulk Terminal - Indonesia
- The Treasury - Australian Government
- Bangladesh Power Developement Board
- Lanco Infratech Ltd - India
- Bayan Resources Tbk. - Indonesia
- Samtan Co., Ltd - South Korea
- Therma Luzon, Inc, Philippines
- Central Electricity Authority - India
- Australian Commodity Traders Exchange
- Savvy Resources Ltd - HongKong
- Mjunction Services Limited - India
- Intertek Mineral Services - Indonesia
- Xindia Steels Limited - India
- Kaltim Prima Coal - Indonesia
- Simpson Spence & Young - Indonesia
- Semirara Mining Corp, Philippines
- Tata Chemicals Ltd - India
- Merrill Lynch Commodities Europe
- Miang Besar Coal Terminal - Indonesia
- Latin American Coal - Colombia
- Indian Oil Corporation Limited
- OPG Power Generation Pvt Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Metalloyd Limited - United Kingdom
- Makarim & Taira - Indonesia
- Karaikal Port Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Maheswari Brothers Coal Limited - India
- Indika Energy - Indonesia
- Economic Council, Georgia
- London Commodity Brokers - England
- Wilmar Investment Holdings
- Madhucon Powers Ltd - India
- Ambuja Cements Ltd - India
- Formosa Plastics Group - Taiwan
- SN Aboitiz Power Inc, Philippines
- PNOC Exploration Corporation - Philippines
- Siam City Cement PLC, Thailand
- IHS Mccloskey Coal Group - USA
- Globalindo Alam Lestari - Indonesia
- Ind-Barath Power Infra Limited - India
- Mercuria Energy - Indonesia
- Indonesian Coal Mining Association
- Pendopo Energi Batubara - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- CIMB Investment Bank - Malaysia
- Rio Tinto Coal - Australia
- Kideco Jaya Agung - Indonesia
- White Energy Company Limited
- Indogreen Group - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Carbofer General Trading SA - India
- Barasentosa Lestari - Indonesia
- Thiess Contractors Indonesia
- Price Waterhouse Coopers - Russia
- Straits Asia Resources Limited - Singapore
- Trasteel International SA, Italy
- Asmin Koalindo Tuhup - Indonesia
- Riau Bara Harum - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Electricity Authority, New Zealand
- CNBM International Corporation - China
- Central Java Power - Indonesia
- Global Coal Blending Company Limited - Australia
- VISA Power Limited - India
- Vizag Seaport Private Limited - India
- Timah Investasi Mineral - Indoneisa
- Manunggal Multi Energi - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Minerals Council of Australia
- Mintek Dendrill Indonesia
- Kartika Selabumi Mining - Indonesia
- Bharathi Cement Corporation - India
- Electricity Generating Authority of Thailand
- Deloitte Consulting - India
- Bhushan Steel Limited - India
- Georgia Ports Authority, United States
- Maharashtra Electricity Regulatory Commission - India
- Attock Cement Pakistan Limited
- Bulk Trading Sa - Switzerland
- Antam Resourcindo - Indonesia
- Vedanta Resources Plc - India
- SMG Consultants - Indonesia
- Essar Steel Hazira Ltd - India
- Ministry of Finance - Indonesia
- Marubeni Corporation - India
- Chettinad Cement Corporation Ltd - India
- European Bulk Services B.V. - Netherlands
- Uttam Galva Steels Limited - India
- Ceylon Electricity Board - Sri Lanka
- San Jose City I Power Corp, Philippines
- Siam City Cement - Thailand
- ICICI Bank Limited - India
- PTC India Limited - India
- LBH Netherlands Bv - Netherlands
- Planning Commission, India
- Meralco Power Generation, Philippines
- Interocean Group of Companies - India
- Ministry of Mines - Canada
- Oldendorff Carriers - Singapore
- Aboitiz Power Corporation - Philippines
- Standard Chartered Bank - UAE
- Coalindo Energy - Indonesia
- McConnell Dowell - Australia
- Bukit Makmur.PT - Indonesia
- Star Paper Mills Limited - India
- Binh Thuan Hamico - Vietnam
- Bahari Cakrawala Sebuku - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Romanian Commodities Exchange
- Banpu Public Company Limited - Thailand
- Meenaskhi Energy Private Limited - India
- Malabar Cements Ltd - India
- Toyota Tsusho Corporation, Japan
- Wood Mackenzie - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Goldman Sachs - Singapore
- Global Business Power Corporation, Philippines
- Energy Development Corp, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Aditya Birla Group - India
- Anglo American - United Kingdom
- Bukit Baiduri Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Jorong Barutama Greston.PT - Indonesia
- MS Steel International - UAE
- TeaM Sual Corporation - Philippines
- Agrawal Coal Company - India
- Baramulti Group, Indonesia
- Salva Resources Pvt Ltd - India
- Grasim Industreis Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Jaiprakash Power Ventures ltd
- Kepco SPC Power Corporation, Philippines
- Energy Link Ltd, New Zealand
- Sojitz Corporation - Japan
- Holcim Trading Pte Ltd - Singapore
- Coal and Oil Company - UAE
- GVK Power & Infra Limited - India
- IEA Clean Coal Centre - UK
- Cement Manufacturers Association - India
- Orica Australia Pty. Ltd.
- India Bulls Power Limited - India
- GAC Shipping (India) Pvt Ltd
- Ministry of Transport, Egypt
- Tamil Nadu electricity Board
- The University of Queensland
- Coastal Gujarat Power Limited - India
- Sarangani Energy Corporation, Philippines
- Eastern Energy - Thailand
- Kumho Petrochemical, South Korea
- Australian Coal Association
- Gujarat Mineral Development Corp Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Thai Mozambique Logistica
- Sree Jayajothi Cements Limited - India
- Parry Sugars Refinery, India
- Kohat Cement Company Ltd. - Pakistan
- Port Waratah Coal Services - Australia
- Edison Trading Spa - Italy
- Mercator Lines Limited - India
- The State Trading Corporation of India Ltd
- Parliament of New Zealand
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