A roundup of international coal news from March 20 to March 27.
A report produced by environmental advocates outlined a dramatic drop in coal power capacity in 2016 and a decline in planned coal projects, due in large part to shifting policies and economic conditions in China and India.
A joint report by Greenpeace, the Sierra Club and CoalSwarm suggests that coal projects under pre-construction plunged 48% year over year to 570 GW in January 2017 from 1,090 GW in January 2016, global construction starts dropped 62%, ongoing construction declined 19% and completed projects fell 29%.
China: Shipments of North Korean anthracite coal to China posted an 18.7% contraction year over year in February to 1.23 million tonnes, dropping to a two-year low since January 2015, Reuters reported March 23, citing data from the General Administration of Customs. This compares to January deliveries, which settled at 1.45 million tonnes, or a 13% year-over-year cutback, following the country's recent ban on all imports of North Korean coal in response to Pyongyang's missile program.
Coal miner Henan Dayou Energy Co. Ltd. said March 21 that it expected to post a net loss for a second consecutive year in 2016 and warned that it was at risk of being delisted. Companies listed on the Shanghai Stock Exchange may be delisted if they post net losses for two years in a row.
India: The Competition Commission of India imposed a fine of 5.91 billion Indian rupees on Coal India Ltd. for violating competition norms by having unfair terms in fuel supply agreements, Press Trust of India reported March 24, citing the 56-page order. The regulator also ordered the state-run coal giant to stop anti-competitive practices.
Indian power utilities imported 60.38 million tonnes of thermal coal from April 2016 to February 2017, down almost 20% year over year, according to data released by the Central Electricity Authority and reported by S&P Global Platts. Private-sector power company Adani Power imported the largest volume of thermal coal during the 11-month period at about 14.5 million tonnes. Tata Power Co Ltd.'s Mundra Ultra Mega Power Project followed with about 9.9 million tonnes.
Japan: Japan-based Tohoku Electric Power Co. Inc. agreed to buy thermal coal from its Australian suppliers for $80 to $83 per tonne f.o.b Newcastle for annual negotiated term contracts starting April 1, S&P Global Platts reported March 24, citing a source familiar with the matter. Contracts commencing April 1 represent the largest volume of Japanese thermal coal imports, clocking in at roughly 20 million to 40 million tonnes, said the report.
South Korea: All five South Korean power utilities have purchased U.S. thermal coal for delivery in the third quarter, with approximately 1.5 million tonnes destined to arrive at Korean ports between July and September, a market source told S&P Platts on March 22. One motivation for Korean utilities to take more U.S. thermal coal is the relatively high prices of Indonesian thermal coal, which have fluctuated widely since late last year. Another is a pending increase in the Korean government's consumption tax on imported thermal coal, the market source said.
BHP Billiton Group and Glencore Plc are suspending production at their coal mining operations in Queensland, Australia, amid expectations that a severe tropical cyclone will hit the state on the morning of March 28, Bloomberg News reported March 27, citing company statements. BHP Billiton will report in the upcoming quarterly operational review any impact to output stemming from the suspension of its South Walker Creek metallurgical coal operations. Meanwhile, Glencore said it will curb output from the Collinsville and Newlands mines, while the Oaky Creek, Clermont and Rolleston coal mines will continue normal operations.
Former Australian Greens party leader Bob Brown is backing a new environmental challenge against Adani Enterprises Ltd.'s Carmichael coal project in Queensland, Australia, Bloomberg News reported March 21, citing an emailed statement from Brown. The new campaign to stop the project was set to launch March 22 and collectively represents about 1.5 million Australians.
A Mitsubishi Corp. spokesman confirmed reports that the company may off-load its thermal coal assets in Australia and increase its focus on coking coal and other core assets, Reuters reported March 22. In the previous week, the Japanese company was reportedly looking to sell its 31.4% stake in the Clermont coal mine in Queensland and was considering an option to divest its 32.4% stake in the Hunter Valley Operations.
Australia's New Hope Corp. Ltd. has ratcheted up its coal output by 45.1% year over year in the first half of the 2017 financial year, with the increase largely attributable to the addition to its portfolio of the Bengalla joint venture. Run-of-mine coal production climbed to 7.4 million tonnes, from 5.1 million tonnes in the prior corresponding period.
Colombia: Colombia is on track to produce at least 95 million tonnes of coal in 2017, below an initial target of 102 million tonnes but higher than the 2016 high, according to one of the country's top mining officials. "The country's great potential in coal is reflected in the close to 6 billion tonnes of reserves and a potential of 16 billion tonnes," Carlos Cante, vice minister of mining and energy, told a coal conference in Cartagena that was reported March 22 by Reuters.
As of March 24, US$1 was equivalent to 65.39 Indian rupees.
S&P Global Platts and S&P Global Market Intelligence are owned by S&P Global Inc.
This feature was updated as of 11:53 a.m. ET on March 27. Some external links may require a subscription.