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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 in nine years and China’s record imports increase demand and drain stockpiles.
Prices will average $59.28 a ton this year, up 17 percent from $50.75 as of Feb. 19 on the New York Mercantile Exchange and 41 percent more than last year’s low in April, according to the median of 11 analyst estimates in a Bloomberg News survey. Stockpiles at utilities swelled last year after a mild summer and the economic recession reduced power demand.
China, the world’s biggest coal user, imported 16.4 million metric tons in December, a sixfold increase from a year earlier, customs data show. Record snowfall buried parts of the U.S., the second-biggest coal consumer, including Dallas and the mid- Atlantic states. The cold weather is reducing a surplus and giving producers Patriot Coal Corp., Consol Energy Inc. and Alpha Natural Resources Inc. power to negotiate higher prices.
“We’re definitely bullish for a confluence of factors,” said Jeremy Sussman, senior coal analyst at Brean Murray Carret & Co., a New York-based boutique investment bank. “We can see the light at the end of the tunnel in the U.S. The weather has definitely had an impact. The international market is front and center.”
Consol, the second-biggest U.S. coal company by market value, will jump 18 percent to $59 by the end of this year in New York trading, according to the median of 17 analyst estimates compiled by Bloomberg. Alpha, the third-biggest U.S. coal producer by output, will climb 22 percent to $57.46, analysts forecast.
Patriot Rises
Patriot rose 35 cents, or 2 percent, to $17.62, today in New York Stock Exchange composite trading, the highest price since Jan. 21. Consol added 3 cents, to $49.94. Alpha slipped 16 cents, or 0.3 percent, to $46.94. Massey Energy Co., the sixth- biggest U.S. coal producer, climbed 12 cents, or 0.3 percent, to $44.39.
Hedge funds have been buying energy producers, mining companies and airlines, a sign that managers from Louis Bacon to David Tepper are convinced the economy will accelerate. Duquesne Capital Management LLC, led by Stanley Druckenmiller, bought 6.2 percent of Massey, whose earnings are projected to double this year.
The increased U.S. and Chinese consumption prompted Michael Dudas, an analyst at Jefferies & Co. in New York, to raise his 2010 price target for coal to $70 per ton, a figure he originally forecast for 2011.
Coal Inventories
“The weather and better electricity generation have pushed stockpiles lower than people anticipated,” said Dudas, who has followed coal for a decade. “It’s really just accelerating that price.”
Utilities have 57 days worth of coal on hand, down from more than 70 days at the start of winter, according to Genscape Inc., a Louisville, Kentucky-based energy data provider.
“The pricing increases are real,” Consol Chief Operating Officer Nicholas Deiuliis said in a telephone interview. “If you look at the pricing increases we’re seeing now in regard to future sales, they have not only floored or held their bottom, they are starting to spike up.”
Coal is used to generate electricity and produce steel, making it a barometer for the economy. U.S. steel capacity utilization tumbled to 68 percent as of Feb. 15 from 91 percent in August 2008, according to the American Iron and Steel Institute, as unemployment climbed to 10 percent and consumers reduced spending 3 percent on appliances in December from a year earlier.
Prices Slide
The U.S. summer from June through August was 7 percent cooler than the same period a year earlier, reducing demand for power to run air conditioners, according to the National Oceanic and Atmospheric Administration.
Prices plunged 66 percent to $48.15 per ton at the end of 2009 from a record $143 on July 1, 2008, the steepest decline in at least eight years, according to data compiled by Bloomberg. The 17 percent gain forecast by analysts would be the largest since 2007.
Utilities amassed a record 207 million tons as demand for coal to generate electricity dropped 12 percent through Sept. 30, according to the most recent U.S. Energy Department data. Consumption for 2009 was projected to be below 1 billion tons for the first time since 1995. The government will release final figures in March.
Producers cut back output as demand slumped and that’s having an impact even as demand rises. U.S. coal production will slump about 2.8 percent this year just as exports increase 5.6 percent, the Energy Department said Feb. 10.
Record Snowfall
The 2009-2010 winter season, which began Dec. 1, is the coldest since the 2000-2001 season and ranks in the coldest third of winters in the past 115 years, according to Jeff Masters, director of meteorology for Weather Underground Inc., a private forecaster based in Ann Arbor, Michigan.
The federal government shut down for four days this month after Washington was hit with a storm that set a seasonal snow total of 54.9 inches, shattering a 110-year-old record.
For St. Louis-based Patriot, Pittsburgh-based Consol and Alpha, based in Abingdon, Virginia, the frigid conditions are providing relief.
“The cold weather is the best thing they can get right now that’s not a full economic recovery,” said Daniel Scott, an analyst at Dahlman Rose & Co. in New York. “People are no longer scared to talk about thermal coal.”
Interest Rates
The risk to forecasts for higher coal prices is a glut of natural gas in the U.S. and prospects for the economy to stumble as the Federal Reserve boosts interest rates for the first time since June 2006. The Fed last week raised the discount rate charged to banks for direct loans by a quarter point to 0.75 percent to encourage banks to borrow in private markets.
“If the economy tanks again, that changes the outlook,” according to James Rollyson, senior coal analyst at Raymond James Financial Inc. in Houston. “The economy and particularly this year natural gas prices are the variables. Coal lost market share to natural gas because we averaged $4 gas for the year.”
The U.S. relies on coal for about half of its power generation, compared with about 20 percent for gas.
Gas has to stay above $5 per million British thermal units to prevent it from being more attractive to utilities at the expense of coal. Natural gas for March delivery fell 14.9 cents, or 3 percent, to $4.895 per million Btu. Rollyson estimates that through November coal lost about 40 million tons worth of demand to gas.
Chinese Imports
China’s National Energy Administration said Jan. 25 that a coal shortage will persist through March. The country has maintained the record import pace set in December because of the country’s coldest winter in at least 50 years, according to Sutthichai Kumworachai, an analyst with KGI Group in Bangkok.
The country’s gross domestic product expanded 10.7 percent last quarter from a year earlier, the fastest pace since 2007, after the government introduced a $586 billion stimulus package that spurred energy consumption.
China’s appetite for coal led to imports from South Africa, diverting supplies from Europe and creating an opportunity for eastern U.S. coal companies such as Alpha Natural Resources, Consol and Patriot to increase sales across the Atlantic Ocean, Brean Murray Carret’s Sussman said.
This year Consol has sold almost 500,000 tons of coal into Asian markets, a 23 percent increase from the 400,000 tons that it shipped to the region for the first time last year, Dan Zajdel, a company spokesman said. As more companies follow, the exports will squeeze U.S. utilities, said Pearce Hammond, an analyst at Simmons & Co. International in Houston.
Lower Temperatures
“That’s essentially robbing utilities of coal,” Hammond said. “They don’t need it right now, but in the future they will.”
From the mid-Atlantic to the Southeast through the Gulf Coast into Texas, temperatures are averaging 4 degrees to 8 degrees below normal, said Tom Kines, a senior expert meteorologist with AccuWeather.com in State College, Pennsylvania.
“That is pretty significant,” he said.
The cold is having an impact as measured by heating-degree- day values, which have been trending higher along the East Coast and across the South, according to the National Weather Service. The value is calculated by subtracting the average daily temperature from a base of 65 degrees and is designed to show energy demand.
New York Weather
This month, New York’s heating-degree-day value is 572, or 36 greater than normal, according to the National Weather Service.
Coal prices will get a larger boost if the U.S. economy can sustain its recovery, Alpha Chief Executive Officer Kevin Crutchfield said in an interview. The world’s largest economy will grow 3 percent this year and next, according to the median estimate of 62 economists surveyed by Bloomberg News.
“That would be the best thing in the quiver, a bona-fide economic recovery, especially on the industrial side,” Crutchfield said. “If you see any type of economic stimulus and economic recovery at all, that would hasten the recovery even faster.”
Source: Bloomberg - Mario Parker
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Tuesday, 23 February 10
UAE COMPANY TO ACQUIRE CONTROL OF ALLBOND MAKMUR
The Jakarta globe reported that, Renuka Energy Resources Holding, based in the United Arab Emirates, has signed an agreement to acquire 80 percent o ...
Tuesday, 23 February 10
CIL SHORTLISTS 24 FOREIGN COS FOR JV
India's Economic Times reported that, Coal India has shortlisted 24 foreign firms — six each from the US, Australia, South Africa and Indones ...
Saturday, 20 February 10
THE FREIGHT MARKET CONTINUED TO BE SOFT THIS WEEK - CAPT. REDDY
COALspot.com: The freight market continued to be soft this week as still affect of Chinese new year holidays continue. However the index overall had ...
Friday, 19 February 10
MAKING THE JOINT COOPERATION OF PRIVATE GOVERNMENT IN INDONESIA
COALspot.com - Press Release
1. Revision of the presidential decree 67/2005 has been signed by the President on January 28, 2010 with the public ...
Thursday, 18 February 10
THE INDIAN MARKET IS FIRMING A BIT, DUE TO LACK OF TONNAGE IN THE REGION
HANDY
The BSI still decline as holidays around the world have reduced trading.
...
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- Bhoruka Overseas - Indonesia
- GMR Energy Limited - India
- Power Finance Corporation Ltd., India
- Karbindo Abesyapradhi - Indoneisa
- Petrochimia International Co. Ltd.- Taiwan
- Eastern Energy - Thailand
- Vijayanagar Sugar Pvt Ltd - India
- Larsen & Toubro Limited - India
- Kideco Jaya Agung - Indonesia
- European Bulk Services B.V. - Netherlands
- Mercator Lines Limited - India
- VISA Power Limited - India
- Indian Oil Corporation Limited
- Billiton Holdings Pty Ltd - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- London Commodity Brokers - England
- Indika Energy - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bayan Resources Tbk. - Indonesia
- Australian Commodity Traders Exchange
- Commonwealth Bank - Australia
- Anglo American - United Kingdom
- Kepco SPC Power Corporation, Philippines
- Georgia Ports Authority, United States
- Interocean Group of Companies - India
- Altura Mining Limited, Indonesia
- Carbofer General Trading SA - India
- Borneo Indobara - Indonesia
- Sree Jayajothi Cements Limited - India
- Renaissance Capital - South Africa
- Minerals Council of Australia
- Holcim Trading Pte Ltd - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Cigading International Bulk Terminal - Indonesia
- Meralco Power Generation, Philippines
- ASAPP Information Group - India
- Aboitiz Power Corporation - Philippines
- Wood Mackenzie - Singapore
- Kaltim Prima Coal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Eastern Coal Council - USA
- Energy Link Ltd, New Zealand
- Mintek Dendrill Indonesia
- Attock Cement Pakistan Limited
- Merrill Lynch Commodities Europe
- Port Waratah Coal Services - Australia
- Ambuja Cements Ltd - India
- Salva Resources Pvt Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Essar Steel Hazira Ltd - India
- Agrawal Coal Company - India
- Baramulti Group, Indonesia
- Semirara Mining and Power Corporation, Philippines
- Thai Mozambique Logistica
- PNOC Exploration Corporation - Philippines
- Bharathi Cement Corporation - India
- PetroVietnam Power Coal Import and Supply Company
- Pendopo Energi Batubara - Indonesia
- Petron Corporation, Philippines
- Coastal Gujarat Power Limited - India
- Indonesian Coal Mining Association
- Price Waterhouse Coopers - Russia
- Romanian Commodities Exchange
- Singapore Mercantile Exchange
- Parliament of New Zealand
- Latin American Coal - Colombia
- CIMB Investment Bank - Malaysia
- TNB Fuel Sdn Bhd - Malaysia
- Electricity Generating Authority of Thailand
- Cement Manufacturers Association - India
- International Coal Ventures Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Mjunction Services Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Siam City Cement PLC, Thailand
- White Energy Company Limited
- Leighton Contractors Pty Ltd - Australia
- Jindal Steel & Power Ltd - India
- Samtan Co., Ltd - South Korea
- Aditya Birla Group - India
- Ministry of Finance - Indonesia
- Bangladesh Power Developement Board
- Vizag Seaport Private Limited - India
- Dalmia Cement Bharat India
- Rashtriya Ispat Nigam Limited - India
- OPG Power Generation Pvt Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Krishnapatnam Port Company Ltd. - India
- Orica Mining Services - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Bukit Makmur.PT - Indonesia
- Bhushan Steel Limited - India
- Therma Luzon, Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- IHS Mccloskey Coal Group - USA
- Global Business Power Corporation, Philippines
- GVK Power & Infra Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Metalloyd Limited - United Kingdom
- SMG Consultants - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Medco Energi Mining Internasional
- Semirara Mining Corp, Philippines
- Orica Australia Pty. Ltd.
- Rio Tinto Coal - Australia
- Toyota Tsusho Corporation, Japan
- Barasentosa Lestari - Indonesia
- LBH Netherlands Bv - Netherlands
- CNBM International Corporation - China
- The Treasury - Australian Government
- Standard Chartered Bank - UAE
- Tamil Nadu electricity Board
- Tata Chemicals Ltd - India
- Savvy Resources Ltd - HongKong
- Karaikal Port Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Global Coal Blending Company Limited - Australia
- Bhatia International Limited - India
- Ministry of Mines - Canada
- Ceylon Electricity Board - Sri Lanka
- SN Aboitiz Power Inc, Philippines
- Economic Council, Georgia
- Central Java Power - Indonesia
- Madhucon Powers Ltd - India
- Intertek Mineral Services - Indonesia
- Lanco Infratech Ltd - India
- San Jose City I Power Corp, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indo Tambangraya Megah - Indonesia
- Formosa Plastics Group - Taiwan
- Kobexindo Tractors - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- Independent Power Producers Association of India
- Indogreen Group - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Uttam Galva Steels Limited - India
- Xindia Steels Limited - India
- Makarim & Taira - Indonesia
- SMC Global Power, Philippines
- Edison Trading Spa - Italy
- Videocon Industries ltd - India
- Antam Resourcindo - Indonesia
- Africa Commodities Group - South Africa
- Sindya Power Generating Company Private Ltd
- Global Green Power PLC Corporation, Philippines
- Chamber of Mines of South Africa
- Manunggal Multi Energi - Indonesia
- The State Trading Corporation of India Ltd
- Star Paper Mills Limited - India
- Binh Thuan Hamico - Vietnam
- Globalindo Alam Lestari - Indonesia
- PTC India Limited - India
- Siam City Cement - Thailand
- Vedanta Resources Plc - India
- IEA Clean Coal Centre - UK
- Wilmar Investment Holdings
- Electricity Authority, New Zealand
- New Zealand Coal & Carbon
- Coalindo Energy - Indonesia
- Kumho Petrochemical, South Korea
- Simpson Spence & Young - Indonesia
- India Bulls Power Limited - India
- Deloitte Consulting - India
- PowerSource Philippines DevCo
- Maheswari Brothers Coal Limited - India
- Sical Logistics Limited - India
- Oldendorff Carriers - Singapore
- Jaiprakash Power Ventures ltd
- The University of Queensland
- Planning Commission, India
- Riau Bara Harum - Indonesia
- Straits Asia Resources Limited - Singapore
- South Luzon Thermal Energy Corporation
- Parry Sugars Refinery, India
- Banpu Public Company Limited - Thailand
- Thiess Contractors Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Ministry of Transport, Egypt
- Malabar Cements Ltd - India
- Marubeni Corporation - India
- Bulk Trading Sa - Switzerland
- Trasteel International SA, Italy
- GAC Shipping (India) Pvt Ltd
- Central Electricity Authority - India
- TeaM Sual Corporation - Philippines
- Grasim Industreis Ltd - India
- Australian Coal Association
- Sakthi Sugars Limited - India
- Mercuria Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Coal and Oil Company - UAE
- Indian Energy Exchange, India
- Gujarat Sidhee Cement - India
- Heidelberg Cement - Germany
- MS Steel International - UAE
- Timah Investasi Mineral - Indoneisa
- Directorate General of MIneral and Coal - Indonesia
- Energy Development Corp, Philippines
- Posco Energy - South Korea
- AsiaOL BioFuels Corp., Philippines
- Meenaskhi Energy Private Limited - India
- McConnell Dowell - Australia
- Goldman Sachs - Singapore
- Sojitz Corporation - Japan
- ICICI Bank Limited - India
- Iligan Light & Power Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Directorate Of Revenue Intelligence - India
- Bukit Baiduri Energy - Indonesia
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