Covid-19 Catches up with Seaborne Coal in Asia
The coronavirus pandemic has finally caught up with seaborne thermal coal in Asia, as soft demand in major importers India and China sends prices to multi-year lows and dents the polluting fuel's relative outperformance against other energy.The price of low-energy coal from Indonesia, the world's top exporter of thermal coal, has dropped to the lowest since assessments were started by commodity price reporting agency Argus in 2008, while higher-quality Australian supplies have slumped to a four-year low.Indonesian coal with an energy value of 4…
China's Coal Import Restrictions may Pressure Pricing
The price of seaborne thermal coal in Asia may come under pressure as China moves to impose some import restrictions on imports of the polluting fuel. Several ports in southern and eastern China have introduced controls on coal imports, ranging from bans on unloadings to tightening customs clearances. Among ports banning imports is the Chuanshon anchorage at Ningbo port, according to a manager at a coal trading house quoted by Reuters on Monday, while Zhoushan near Shanghai is restricting the number of vessels allowed to dock. What is not clear yet is just how severe these restrictions are, how widespread they will become and how long they will last.
Coal Delays Seasonal Price Decline
It's getting to the time of year when a seasonal decline in thermal coal prices in Asia is to be expected as winter's demand peak passes - but so far the power station fuel is defying gravity. The price of spot cargoes of thermal coal from Australia's Newcastle port, a regional benchmark, ended at $108.75 a tonne on Jan. 19, within touching distance of the $109.50 reached on Jan. 17, which was the highest in a year. The price has rallied 5.8 percent since the end of last year and by 18 percent since the most recent trough of $92.20 a tonne on Nov. 23.
China's LNG Woes Boost Coal, But for How Long?
A sure sign that China is struggling with its planned switch to natural gas from coal for winter heating is the spot price of Australian coal climbing back above $100 a tonne. Spot cargoes of thermal coal from Australia's Newcastle port , an Asian benchmark for the fuel used mainly in power plants, rose to $100.65 a tonne on Wednesday, breaching the triple-figure barrier for the first time since Nov. 1 and hitting their highest since mid-September. The price is also 9.2 percent higher than a recent low of $92.20 touched on Nov.
China Trims Appetite, but Coal Prices Unfazed
There are indications that China's appetite for imported coal may be starting to ease in line with Beijing's efforts to limit the use of the fuel over winter in a bid to lower air pollution. China's seaborne imports were 18.26 million tonnes in November, down from 20 million in October, according to vessel-tracking and port data compiled by Thomson Reuters Supply Chain and Commodity Forecasts. It's the fourth consecutive monthly decline for seaborne coal imports, according to the data, and it comes as the authorities impose productions cuts on coal-consuming industries such as steel.
Future of LNG's Asian Rally Uncertain
The spot price of liquefied natural gas (LNG) in Asia is enjoying its traditional surge ahead of peak winter demand, and the near 40 percent rally over the past six weeks probably has further to go. While exporters of the super-chilled fuel will no doubt be trying to maximise the number of spot cargoes they offer, of more interest to them may be how steep the post-winter drop is likely to be. Much of the current boost to prices is due to stronger-than-expected Chinese demand, as Beijing expands use of the cleaner-burning fuel in place of coal for winter heating.
Coal's Rally Isn't All About China
It is increasingly popular to write obituaries for coal, with analysts, market watchers, investors and utility bosses leaping on the bandwagon, declaiming that the days of the polluting fuel are numbered. Certainly the long-term outlook for coal is becoming less certain as more countries commit to ending, or severely curtailing, use of the fuel. But while the doomsayers may eventually be proven correct, coal is enjoying a stellar year, particularly in Asia, the main demand centre. The price of benchmark prices for thermal coal at Australia's Newcastle Port slipped toward the end of last week, but still ended above $100 a tonne on Sept. 15.
Coal Price Surge Justified by China's Dynamics: Russell
How much of the current surge in thermal coal prices in Asia is because of a fundamental shift in the supply-demand balance, and how much is down to speculative froth? This is a question often asked when a commodity experiences a strong gain - or drop - in price, especially when the fundamentals don't appear to have shifted that much, at least on a casual view. Virtually everybody in the coal industry can agree that the strong performance in seaborne thermal coal this year is being driven by market dynamics in top importer China.
Weather Impacts China Coal Imports, Prices
Thermal coal prices in Asia have had a strong run recently, amid Chinese demand and supply disruptions in major exporters, but these factors point to a temporary boost rather than any structural change. The price of spot cargoes from Australia's Newcastle port , the world's largest thermal coal export harbour, have jumped 23 percent since mid-May to close on Wednesday at $87.90 a tonne. While still negative for the year, the recent rally has taken Newcastle coal close to the $93.50 a tonne it fetched at the end of last year.
Rio Picks Yancoal for Coal Sale
Rio sticks with Yancoal over Glencore for coal mine sale. Rio Tinto on Monday confirmed Yancoal Australia as the preferred buyer for its Australian Coal & Allied unit after the China-backed company added an eleventh-hour sweetener to top a rival bid from Glencore. Yancoal, increased its offer to $2.69 billion from $2.45 billion, adding $240 million in unconditional guaranteed royalty payments to a cash offer of $2.45 billion. "The revised offer from Yancoal of $2.69 billion offers compelling value to our shareholders for our Australian thermal coal assets," Rio Tinto Chief Executive Jean-Sebastien Jacques said in a statement.
Coal Exporters Wary of Chinese Impact on Demand
Coal rally driven by largely unexpected Chinese demand, but China's unpredictability leaves coal exporters wary. The problem with coal's spectacular rally this year is that it's largely a Chinese political phenomenon, and what Chinese politicians give they can just as easily take away. Australian thermal coal spot cargoes at Newcastle port for November this week breached $100 a tonne for the first time in 4-1/2 years, closing on Tuesday at $102.20 and taking this year's rally to almost 120 percent. There was much head-scratching…
Coal Rally at Risk as China Imports sag
If you believe that thermal coal's rally this year has been largely on the back of rising Chinese imports, it follows that any sign of moderation in demand in the world's biggest buyer would raise a red flag of caution. That banner may be in the process of being hoisted, with shipping data suggesting August imports of the fuel used mainly for power generation may be the lowest for six months. Ship-tracking data compiled by Thomson Reuters Commodity Research and Forecasts estimate that 13.07 million tonnes of coal will arrive in China in August, down substantially from the 18.92 million tonnes in July, which was the most so far this year.
Coal Price Hopes Fade as Asia Demand Slows
Coal's bright start to the year in Asia is fading amid the gloom of weak demand across the region's top importers and still too much supply from top producers. The benchmark Newcastle weekly coal index ended at $51.13 a tonne on April 1, down from its high so far this year of $52.59, reached on March 11. That peak capped a rally of 11 percent from the almost 10-year low of $47.37 a tonne plumbed in the week to Jan. 21, but it now appears it was nothing more than a false dawn. Coal was most likely the beneficiary of better sentiment towards commodities in general that saw strong rallies in iron ore and crude oil in recent weeks…
LNG Needs New Pricing, Rules: Russell
In theory these should be great days for the liquefied natural gas (LNG) industry as new plants are commissioned to supply the clean-burning fuel to energy hungry markets across rapidly developing Asia. But in reality the industry is facing uncertainty as low prices damage the economics of multi-billion dollar investments and the expected demand growth fails to materialise. As is normally the case in complex markets, there is no single villain. Rather there are several factors hurting the industry's fortunes and casting doubts over whether natural gas and LNG will ever see the golden age predicted a few years ago.
Colombia: the Wild Card in Asian Coal Prices
There are several reasons why coal prices in Asia are unlikely to rally much in the coming years, but the most compelling one is also likely one of the most obscure: Colombia. Why should a South American country that hasn't exported much coal to Asia recently provide the cap for prices? Because as soon as Asian coal prices rise to a level that would make sense for Colombian miners to resume exports, they will, and they have as much as 25 million tonnes of spare capacity in their production and export chain. It's true that Colombia and other producers in the Americas…
Coal's Blind Optimism Fades
Battered and beaten, the coal industry finally seems to be moving from blind optimism that things will somehow get better to a more realistic hope that it can survive, albeit in a smaller, less influential manner. A common theme at coal conferences over the past few years is that prices have finally reached a bottom and that a recovery is just around the corner. Given that global coal benchmarks are currently in their fourth consecutive year of declines, this has clearly been an optimistic view, based more on fervent hope than a sober analysis of the state of the industry.
Commodity Rout Unlike 2008, China Unlikely to Rescue
With the prices of many major commodities currently plumbing depths last seen six years ago, what are the chances of a repeat of the China-led boom that lifted resources out of the 2008 recession funk? To answer the question it's worth looking at what is the same and what is different about the weakness in commodity prices between 2008-09 and now, and the answer is not much is the same. The main similarity is simply that prices are weak and have fallen precipitously in a relatively short period of time. Brent crude fell by about 75 percent between the all-time high in July 2008 and the low in December that year.
China, India Coal Numbers Unencouraging: Russell
It seems coal miners and traders just can't catch a break, with a rebound in China's imports being tempered by early signs of a turning point in India's import growth. The main problem for coal exporters such as Australia, Indonesia and South Africa is that China's surge in imports in July is unlikely to be sustained, while India's decline may well be the start of a longer-lasting trend. China, the world's biggest producer and importer of coal, brought in 21.26 million tonnes in July, up 28.1 percent from June's 16.6 million and the highest in eight months, according to customs data released Aug.
Newcastle Coal Port Reopening as Storm passes
Australia's Newcastle port, the world's biggest marine coal export terminal, will reopen later on Thursday after shutting down earlier this week due to a heavy storm, according to the port. Australia's biggest coal companies, including BHP Billiton Ltd , Glencore Plc, Rio Tinto , Peabody Energy Corp and China's Yancoal Australia Ltd rely on the port. (Reporting by Sonali Paul
Crude Decline Cut Both Ways for Miners
The plunge in oil prices is a double-edged sword for many miners, lowering the cost of production but at the same time cutting the value of the commodities they produce. At first glance the 57 percent tumble in Brent crude since June last year would seem to be an unambiguous positive for many commodity producers, given their heavy reliance on diesel to operate mines and transport output to ports. This is especially the case for Australian coal and iron ore mines, which use diesel not only for mining vehicles but to generate electricity as well, given their remote locations.
