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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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Wednesday, 30 December 09
INDIA CEMENTS TO FINALIZE 3 SHIPMENTS OF SOUTH AFRICAN COAL NEXT WEEK
COALspot.com (India): India Cements is looking for 3 shipments (150,000MT) of South African coal for January – March 2010 delivery on C ...
Wednesday, 30 December 09
BANPU EXPECTS STABLE COAL PRICES
2009 revenue growth will be hard to beat
Banpu Plc, Asean's largest coal miner, expects coal prices to stay firm at about US$80 per tonne in the f ...
Wednesday, 30 December 09
CIL DELISTS JAGUAR ENERGY FOR KODA LINKS
Coal India Ltd (CIL) has dropped Indonesia-based Jaguar Energy & Power Ltd from the list of companies, it intended to forge partnerships with to ...
Wednesday, 30 December 09
COAL PRICE RISE REQUEST DENIED
A proposal by the Viet Nam National Coal and Mineral Industries Group to double the price of coal has been turned down by the Ministry of Industry a ...
Wednesday, 30 December 09
CHINA'S 2010 COAL DEMAND COULD RISE 4%-6%, ACCORDING TO CHINA SECURITIES JOURNAL
China, which is the world’s second-largest energy user, may consume between 4 and 6% more coal next year on continued economic growth, China S ...
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- PetroVietnam Power Coal Import and Supply Company
- Central Electricity Authority - India
- Tata Chemicals Ltd - India
- IEA Clean Coal Centre - UK
- Mintek Dendrill Indonesia
- Sindya Power Generating Company Private Ltd
- GAC Shipping (India) Pvt Ltd
- Romanian Commodities Exchange
- Metalloyd Limited - United Kingdom
- Bukit Baiduri Energy - Indonesia
- Sarangani Energy Corporation, Philippines
- Miang Besar Coal Terminal - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Ministry of Finance - Indonesia
- Anglo American - United Kingdom
- Standard Chartered Bank - UAE
- Kepco SPC Power Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Global Green Power PLC Corporation, Philippines
- PTC India Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Indian Energy Exchange, India
- Binh Thuan Hamico - Vietnam
- Krishnapatnam Port Company Ltd. - India
- Madhucon Powers Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Bukit Asam (Persero) Tbk - Indonesia
- CNBM International Corporation - China
- Georgia Ports Authority, United States
- Orica Australia Pty. Ltd.
- Energy Link Ltd, New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- India Bulls Power Limited - India
- VISA Power Limited - India
- Petron Corporation, Philippines
- Medco Energi Mining Internasional
- San Jose City I Power Corp, Philippines
- Borneo Indobara - Indonesia
- Xindia Steels Limited - India
- South Luzon Thermal Energy Corporation
- PNOC Exploration Corporation - Philippines
- Savvy Resources Ltd - HongKong
- Banpu Public Company Limited - Thailand
- Therma Luzon, Inc, Philippines
- Chettinad Cement Corporation Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Kalimantan Lumbung Energi - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Sree Jayajothi Cements Limited - India
- Uttam Galva Steels Limited - India
- Semirara Mining Corp, Philippines
- Straits Asia Resources Limited - Singapore
- Trasteel International SA, Italy
- Price Waterhouse Coopers - Russia
- Independent Power Producers Association of India
- Jorong Barutama Greston.PT - Indonesia
- Power Finance Corporation Ltd., India
- Deloitte Consulting - India
- Bhatia International Limited - India
- Ind-Barath Power Infra Limited - India
- Mercuria Energy - Indonesia
- Latin American Coal - Colombia
- Electricity Authority, New Zealand
- Bangladesh Power Developement Board
- Siam City Cement PLC, Thailand
- Indo Tambangraya Megah - Indonesia
- Electricity Generating Authority of Thailand
- Alfred C Toepfer International GmbH - Germany
- GMR Energy Limited - India
- Dalmia Cement Bharat India
- Coal and Oil Company - UAE
- Goldman Sachs - Singapore
- Oldendorff Carriers - Singapore
- Thiess Contractors Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Interocean Group of Companies - India
- Karaikal Port Pvt Ltd - India
- Central Java Power - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sakthi Sugars Limited - India
- Larsen & Toubro Limited - India
- Mercator Lines Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Rashtriya Ispat Nigam Limited - India
- Minerals Council of Australia
- Merrill Lynch Commodities Europe
- Sinarmas Energy and Mining - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Salva Resources Pvt Ltd - India
- SMG Consultants - Indonesia
- Coastal Gujarat Power Limited - India
- Videocon Industries ltd - India
- Renaissance Capital - South Africa
- Global Coal Blending Company Limited - Australia
- Sical Logistics Limited - India
- Cigading International Bulk Terminal - Indonesia
- Gujarat Sidhee Cement - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Makarim & Taira - Indonesia
- SMC Global Power, Philippines
- Chamber of Mines of South Africa
- Bukit Makmur.PT - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Neyveli Lignite Corporation Ltd, - India
- Manunggal Multi Energi - Indonesia
- Barasentosa Lestari - Indonesia
- Directorate Of Revenue Intelligence - India
- Kobexindo Tractors - Indoneisa
- CIMB Investment Bank - Malaysia
- Maheswari Brothers Coal Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Economic Council, Georgia
- Pendopo Energi Batubara - Indonesia
- Jindal Steel & Power Ltd - India
- New Zealand Coal & Carbon
- Parry Sugars Refinery, India
- Bharathi Cement Corporation - India
- European Bulk Services B.V. - Netherlands
- The Treasury - Australian Government
- Eastern Energy - Thailand
- Bhushan Steel Limited - India
- Indika Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Australian Coal Association
- Kartika Selabumi Mining - Indonesia
- ASAPP Information Group - India
- Edison Trading Spa - Italy
- Altura Mining Limited, Indonesia
- Coalindo Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- Riau Bara Harum - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Indogreen Group - Indonesia
- Kumho Petrochemical, South Korea
- Orica Mining Services - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Ministry of Transport, Egypt
- Aditya Birla Group - India
- Vedanta Resources Plc - India
- OPG Power Generation Pvt Ltd - India
- Singapore Mercantile Exchange
- McConnell Dowell - Australia
- ICICI Bank Limited - India
- PowerSource Philippines DevCo
- Marubeni Corporation - India
- Carbofer General Trading SA - India
- Meralco Power Generation, Philippines
- White Energy Company Limited
- Indian Oil Corporation Limited
- Global Business Power Corporation, Philippines
- Essar Steel Hazira Ltd - India
- Iligan Light & Power Inc, Philippines
- Star Paper Mills Limited - India
- Commonwealth Bank - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Wilmar Investment Holdings
- Parliament of New Zealand
- Kohat Cement Company Ltd. - Pakistan
- Bayan Resources Tbk. - Indonesia
- The University of Queensland
- Kaltim Prima Coal - Indonesia
- Vizag Seaport Private Limited - India
- Rio Tinto Coal - Australia
- Eastern Coal Council - USA
- Simpson Spence & Young - Indonesia
- Bulk Trading Sa - Switzerland
- Leighton Contractors Pty Ltd - Australia
- GVK Power & Infra Limited - India
- Mjunction Services Limited - India
- Semirara Mining and Power Corporation, Philippines
- The State Trading Corporation of India Ltd
- IHS Mccloskey Coal Group - USA
- Port Waratah Coal Services - Australia
- Energy Development Corp, Philippines
- Globalindo Alam Lestari - Indonesia
- Samtan Co., Ltd - South Korea
- Siam City Cement - Thailand
- Malabar Cements Ltd - India
- Kideco Jaya Agung - Indonesia
- London Commodity Brokers - England
- Sojitz Corporation - Japan
- TeaM Sual Corporation - Philippines
- Thai Mozambique Logistica
- Jaiprakash Power Ventures ltd
- Planning Commission, India
- Australian Commodity Traders Exchange
- Gujarat Mineral Development Corp Ltd - India
- Formosa Plastics Group - Taiwan
- Bhoruka Overseas - Indonesia
- Baramulti Group, Indonesia
- Intertek Mineral Services - Indonesia
- Ambuja Cements Ltd - India
- Ministry of Mines - Canada
- Kapuas Tunggal Persada - Indonesia
- Heidelberg Cement - Germany
- Cement Manufacturers Association - India
- Indonesian Coal Mining Association
- SN Aboitiz Power Inc, Philippines
- Tamil Nadu electricity Board
- Attock Cement Pakistan Limited
- Asmin Koalindo Tuhup - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Wood Mackenzie - Singapore
- Posco Energy - South Korea
- Antam Resourcindo - Indonesia
- MS Steel International - UAE
- Agrawal Coal Company - India
- Meenaskhi Energy Private Limited - India
- Africa Commodities Group - South Africa
- Toyota Tsusho Corporation, Japan
- LBH Netherlands Bv - Netherlands
- Grasim Industreis Ltd - India
- Lanco Infratech Ltd - India
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