SA coal exports to India slump
Indonesian prices crimp local volumes
LOWER Indonesian coal prices had shaved off South African export volumes of the commodity to India in the first 11 months of last year.
A market source in the UK, who declined to be named, yesterday told Business Report that exports were price dependent. “If they (buyers) think they can get cheaper coal from Indonesia, they will do so. South Africa has proved to be expensive for Indian buyers,” he said, adding however, that there would always be demand for South African coal in India.
Coal accounts for the bulk of electricity generation in India and China, with 66 percent of India’s total electricity production last year being generated by coal-fired power plants, reports show.
Coal prices at the Richards Bay Coal Terminal (RBCT), which supplies Europe and Asia, averaged $122 (R991) a ton last year.
Indonesia is the largest producer of thermal coal in the world, while the Indonesian Ministry of Energy and Mines has set the January International Coal Price Reference (ICPR) for thermal coal at $109.29 a ton, 2.99 percent down from December.
The ICPR for thermal coal is the basis for determining the prices for 61 Indonesian coal brands. However, because coal was expected to trade at about $111 a ton this year, an increase in exports of the commodity from South Africa to India were expected, he said.
Export of the fuel to India from South Africa declined in the first 11 months of 2011, while China almost doubled coal purchases, according to mjunction services.
India bought 14.39 million tons of the fuel, down 24 percent from the same period a year earlier, India Coal Market Watch, a unit of mjunction, said yesterday. Purchases in November fell 21 percent from the previous year to 1.29 million tons.
South Africa’s shipments to China, the world’s biggest coal consumer, rose 88 percent to 12.26 million tons in the first 11 months of last year, India Coal said, while November sales rose more than threefold 2.84 million tons.
India’s imports accounted for 25 percent of the 57.4 million tons from South Africa to November, according to data from mjunction and the RBCT website. China accounted for
to 21 percent of the shipments. The RBCT did not respond to a request for comment yesterday.
Prices at Richards Bay fell to $105.74 a ton at December 30 from $105.95 a ton a week earlier, data from researcher IHS Mccloskey show.