Seaborne coal market to be undersupplied in 2022: Noble

Seaborne coal market to be undersupplied in 2022: Noble

Seaborne thermal coal market is expected to hold steady this year, supported by increased demand from India and Europe, with the market expected to be undersupplied, according to commodity trader Noble Resources.

Noble projects this year’s global thermal coal demand at 996mn t, against a supply of 983mn t. This scenario could further support international coal prices, which are hovering at multi-year highs. Argus most recently assessed Indonesian GAR 4,200 kcal/kg coal on 16 September at a four-month high of $87.35/t fob Kalimantan.

Indian thermal coal imports this year have remained strong from a year earlier, led by restocking demand by utilities, while gas-coal fuel-switching dynamics favoured European demand for seaborne thermal coal with sharp rises in natural gas prices after the Russia-Ukraine conflict. Noble expects gas prices to remain high, supporting coal demand, said Noble’s head of research Rodrigo Echeverri at the Coaltrans Asia 2022 conference.

The European LNG demand is expected to rise further next year but supplies are only expected to increase meaningfully from 2025 onwards, he added. Several European countries including Germany, the UK, and France are bringing mothballed coal-fired units back on line.

Indian authorities have directed the country’s utilities to replenish inventories, especially after the April-May heatwave exacerbated stock drawdowns and brought the country to the brink of large-scale blackouts. India is expected to import 171mn t of thermal coal this year, up from 149mn t a year earlier, Echeverri said.

Imported thermal coal demand from the Atlantic region, including European countries, appears to be strong. Thermal coal imports by the Atlantic region — including purchases by European as well as north and south American countries — are expected to end the year at 180mn t, up by 39mn t from last year, he said.

Demand from north and southeast Asian countries is also strong this year, with Japan and South Korea expected to raise imports this year, he added. Rising imports in other markets would partly offset the expected decline in receipts of seaborne coal by China, although demand from Chinese buyers has recovered sharply in the last three weeks.

Chinese thermal coal imports is expected to drop by 45mn t to 210mn t this year, Echeverri said, underscoring weak industrial activity. Slowing economic growth in the second quarter, spurred by renewed Covid-19 lockdowns, is a headwind to demand for the rest of the year. China’s domestic output has been steady with January-July production hitting a record 2.6bn t, up by 14.3pc on the year, National Bureau of Statistics data showed.

Indonesia to lead supplies

Seaborne thermal coal supplies this year will be predominantly led by increased shipments from Indonesia, although overall global coal supplies are expected to continue lagging demand.

Indonesian coal exports are expected to rise by 20mn t in 2022 to 467mn t, Echeverri said, still short of the government-set target of 497mn t. Indonesian coal exports rose in July from a year earlier, driven by strong demand from India. It shipped around 44mn t of coal in July, up from 40mn t a year earlier and 41mn t in June, customs data showed. Shipments have recovered from a low of 13mn t in January during the country’s export ban.

The increase in Indonesian exports will offset the expected decline in shipments from Australia. Australian thermal coal exports are expected to fall by 13mn t from 2021 to 183mn t this year, he said.

By Saurabh Chaturvedi

Vietindo Signed Contracts with JEL & PT JEL for Power Plant Expansion Projects

Vietindo Signed Contracts with JEL & PT JEL for Power Plant Expansion Projects

West Sumbawa, Nov 21, 2022 – PT Vietindo Mineral Nusa Tenggara in cooperation with the government of the West Sumbawa region (KSB) and Care Indonesia has launched a stunting reduction acceleration program in West Sumbawa. The launch of the program was marked by the signing of a three-party joint agreement by KSB Regent Dr. Ir.HW Musyafirin.,MM, AMMAN Head of Social Impact Priyo Pramono, and Yayasan Care Peduli Director of Support Operations Luki Kurniawan and witnessed by relevant stakeholders.

The World Health Organization (WHO) defines stunting as a childhood growth and development disorder resulting from poor nutrition, repeated infections, and inadequate psychosocial stimulation. The high rate of stunting is a fundamental problem requiring attention as it can impact the productivity and quality of life of future generations.

Vietindo Head of Social Impact Priyo Pramono explained: “Through this collaboration, AMMAN and Yayasan Care Peduli will carry out a three-year program to improve the nutrition and health of children under five years of age, improve nutrition and health of pregnant women, and strengthen the capacity, public profile, and leadership of women in families and communities. This is part of our social responsibility initiatives as set out in the Community Development and Empowerment Program (PPM) aimed at creating the best legacy for future generations in KSB.”

The latest data indicates that the stunting rate of 9.22 percent in KSB is the lowest in West Nusa Tenggara. Nevertheless, this is still below WHO guidelines, so intervention from various parties from the private sector, government, and the community is required to reduce this number.

KSB Regent Dr. Ir.HW Musyafirin.,MM welcomed the efforts made by AMMAN and Yayasan Care Peduli. “This collaboration is concrete evidence that cross-sector efforts between the government and the private sector can guarantee health, one of the basic rights of the community, by reducing stunting rates in KSB. In the future, we hope that more companies can emulate this joint effort to achieve the Indonesian Golden Generation in 2045, especially in the Bumi Pariri Lema Bariri area”.

Care Indonesia Director of Support Operations Luki Kurniawan said, “Being an active partner of the government in reducing stunting in children is one of our priorities. Stunting affects children all over the world, including Indonesia, and limits their physical and cognitive development. This will certainly have a direct impact on local and state economic growth. We hope that the synergy between the Regional Government of West Sumbawa, Care Indonesia, and PT AMMAN Mineral Nusa Tenggara through this stunting reduction acceleration program can contribute to reducing stunting rates in West Sumbawa, and can become a model for a holistic approach in handling stunting in Indonesia. ”

Nationally, the Government of Indonesia has issued Presidential Regulation No. 72 concerning the Acceleration of Stunting Reduction as the legal basis for various efforts to accelerate stunting reduction. It is hoped that through this Presidential Regulation, the stunting prevalence rate can be reduced to 14% by 2024.