• 4 minutes Trump will meet with executives in the energy industry to discuss the impact of COVID-19
  • 8 minutes Charts of COVID-19 Fatality Rate by Age and Sex
  • 11 minutes Why Trump Is Right to Re-Open the Economy
  • 13 minutes Its going to be an oil bloodbath
  • 3 hours US Shale Resilience: Oil Industry Experts Say Shale Will Rise Again
  • 47 mins While China was covering up Covid-19 it went on an international buying spree for ventilators and masks. From Jan 7th until the end of February China bought 2.2 Billion masks !
  • 2 hours Marine based energy generation
  • 15 hours What If ‘We’d Adopted A More Conventional Response To This Epidemic?’
  • 2 hours China Takes Axe To Alternative Energy Funding, Slashing Subsidies For Solar And Wind
  • 5 hours Real Death Toll In CCP Virus May Be 12X Official Toll
  • 24 mins Today 127 new cases in US, 99 in China, 778 in Italy
  • 23 hours Trafigura CEO Weir says, "We will see 30% to 35% drop in demand". That amounts to 35mm bbls/day glut ! OPEC+ 10 mm cut won't fix it. It's a DEMAND problem.
  • 2 hours Which producers will shut in first?
  • 12 hours TRUMP pushing Hydroxychloroquine + Zpak therapy forward despite FDA conservative approach. As he reasons, "What have we got to lose ?"
  • 1 day The Most Annoying Person You Have Encountered During Lockdown
  • 1 day Cpt Lauren Dowsett
Alt Text

Cloud Peak On Brink Of Collapse After Bad Coal Bet

The U.S. power sector’s pivot…

Alt Text

Coal’s Long Goodbye

U.S. coal producers continue to…

Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Premium Content

The Rush for Coal: Are Price Increases Coming

I've been talking a lot about coal lately.

Specifically, how India's need for thermal coal imports is going to tighten this market, both in terms of prices, and bids for coal deposits within shipping distance of Asia.

India simply doesn't have enough coal. As of yesterday, one-third of the nation's coal-fired power plants were running at "critical" levels of coal stocks (meaning less than seven days of supply). And 10% are at "super-critical", with less than four days of stock.

I've been on this theme for about six months. And finally some of the signs of India's "dash for coal" are starting to appear.

First, buy-outs of coal deposits. Last week, Canadian-listed coal developer CIC Energy received a $400 million takeover offer from a "multi-billion dollar Indian conglomerate". CIC is moving forward the Mmambula coal field in southeastern Botswana (thanks for the heads-up, Saee).

India is even getting active in the junior side of the coal business. This week India's Bhushan Steel announced its intent to buy a stake in Bowen Energy, an Australian coal explorer and developer with projects in the Bowen Basin.

Then there's the signals from the coal market itself. This week, the chairman of the Indonesian Coal Mining Association told attendees at the Coaltrans Upgrading Coal Forum in Jakarta that India will pass Japan as Indonesia's biggest coal export customer by 2011.

"In the past, India only bought high-quality coal, but now they started buying a lot of low-rank coal also because of an increase in domestic consumption," chairman Bob Kamandanu said. He predicted India's coal imports from Indonesia will rise to 70 million tonnes, up from 40 million tonnes this year.

In addition, Bloomberg reported this week that traders handling Richards Bay, the biggest export port for South African coal, believe rising demand from India could push coal prices at this locale to a two-year high.

The piece also quoted T.K. Chatterjee, procurement manager at Indian power major NTPC, as saying, "India will be importing in a big way... This will lead to an increase in prices."

By. Dave Forest of Notela Resources


Download The Free Oilprice App Today

Back to homepage






Leave a comment
  • Anonymous on September 24 2010 said:
    The levels are dire. I have seen it first hand myself. India have had opportunities to buy for some time now, but seem to have hessitated. This has been there main mistake. They will never really sort out their internal issues for local coal deposits for ages. They need a heavy block of coal rapidly, but the 2013+ forecasts are dire. The only near term producer that could cool the gapping ucler. The only real one with major potential I see is Churchill Mining / PT Coal Development group. At 35m tonnes that will give them something to chew on. Even that will take a couple of years. They really need to BUY and stop WATCHING. Nice article

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News