Monthly Summary Of Imported Coal &Petcoke

Indicative Imported Coal Price

COAL (kcal/kg) Monthly Price - FOB Monthly Price- FOB Monthly Change (USD) South Africa 6000 NAR USD 135.20 INR 10178 -7.05 South Africa 5500 NAR USD 110.30 INR 8303 -4.20

Australia 5500 NAR USD 101.97 INR 7676 -12.79

Indonesia 5000 GAR USD 99.18 INR 7466 -22.16

Indonesia 4200 GAR USD 68.72 INR 5173 -17.01

Indicative Pet Coke Price

PET COKE Sulphur Price Monthly Change ($) Exchange Rate Change (Monthly) India-RIL(Ex-Ref.) -5% INR 15680 INR -5101.00 Saudi Arabia (CIF) + 8.5% INR 12197 ($162) -51.98 INR 75.28 0.80

USA (CIF) - 6.5% INR 13821 ($184) -37.40

Indicative Coking Coal Price

Current Month

Monthly Change (USD) Premium Low Vol HCC 64 MID Vol Semi SoftLow Vol PCI Mid Tier PCI MET COKE 62% CSR

FOB CFR China FOB Aus CFR China FOB Aus FOB Aus FOB Aus CFR India FOB N China 339.85 349.65 291.70 321.75 219.25 234.40 233.20 566.00 460.80

-32.09 -147.35 -18.43 -109.50 4.37 -21.23 -1.49 -61.38 -119.95

South African Coal News:

* Amid the renewed scare caused by the spread of Omicron, South African Coal Export Price stands at a current level of $140.07, down from 214.27 last month and up from 69.62 one year ago. This is a 34% drop in price compared to last month. However, export figures are not likely to improve much at present due to issues related to shipments, experts say.

* South Africa’s state power utility Eskom reached a synchronization milestone earlier this month when Unit 4 of the Kusile Power Station Project was connected to the national grid for the first time. Eskom said this would make Kusile, situated in Mpumalanga, South Africa’s “largest construction project and will be the world’s fourth-largest coal plant once completed with six units and will produce a maximum 4,800MW. * In the KwaZulu-Natal province of South Africa, the expanding Somkhele coal mine is having significant impact in the local communities, experts say. While the mine is pivotal to South Africa’s fossil fuel requirements, the Government is cautious regarding the adverse impact it might have on people and environment. Though many locals work for the mine, nearly 150 families have been forcibly relocated as the mine grows.

* Carbon tax and coal procurement costs in South Africa may cause the power tariff to sharply go up, state-owned power utility Eskom has said. The company has applied for a 20.5% electricity tariff increase for the financial year that starts in April, 2022.

* South Africa based miner Thungela Resources that was created following the demerger of Anglo American’s export-focused thermal coal assets, is set to cap a successful debut on the Johannesburg Stock Exchange this year with a better-than-

anticipated final dividend. This follows strong thermal coal prices in the second half of its financial year ended December. The benchmark export coal price averaged $123 per ton for the year-to-date and peaked at R210/t end-October before moderating to $141/t by the end of November. The discount applied to its export coal grades this year narrowed to 17% on average from 26% last year.

Australian Coal News:

* The Adani Group will begin exporting high quality, low sulphur coal from its Carmichael mine in Australia soon by tapping a new multi-decade source to meet energy needs. The first shipment of high-quality coal from the Carmichael mine is being assembled at the North Queensland Export Terminal in Bowen ready for export as planned. The company has planned an initial production of 10 million tonnes a year from the mines in the Galilee Basin.

* For Australian coal, which has faced restrictions in the Chinese market since late 2020, new windows of opportunities have opened up. Many other Asian markets – such as India, Japan, South Korea and Taiwan – have witnessed sharp rises in Australian coal inflows. While the restrictions from China have changed the trade flow map for Australian coal in a big way, they have not made a major dent on overall volumes. Analysts expect Australia’s thermal coal exports in 2021 to fall by only 2.7% year on year and by 1.1% year on year in 2022.

* Australian thermal coal prices may remain relatively high until 2022-23, hit by a lack of investments on the back of recent climate commitments by several countries at the UN Climate Change Conference. Additionally, some proposed coal projects have recently been withdrawn or abandoned, including proposed mines at Dendrobium and the Bylong Valley while the proposed expansion at New Acland continues to face legal objections.

* Australia's Newcastle Port must increase coal shipments by more than 20pc in December from November if it is to match the depressed volumes achieved in 2020, although the weather in its home state of New South Wales (NSW) is against it. Newcastle needs to ship 14.75mn t in December for 2021 exports to match those achieved in 2020. It would need to ship a record breaking 21.46mn t for 2021 to match 2019, which would be 36% more than the monthly maximum of 15.73mn t set in June 2019. * Indonesia has banned coal exports in January 2022 due to concerns over low supplies for domestic power plants, as per a letter sent by the energy ministry. The ministry instructed that all coal at harbours should be stored to supply power plants and independent power producers (IPP). The country has a so-called Domestic Market Obligation (DMO) policy whereby coal miners must supply 25% of annual production to state utility Perusahaan Listrik Negara (PLN) at a maximum price of $70 per tonne, well below current market prices.

*As per latest available data, Indonesian coal export to Japan fell by 41pc in November ’21 from a month earlier to 865,956t after heavy rainfall across Indonesia's main coal-producing region of Kalimantan resulted in production and logistics disruptions. As a result Indonesia has fallen to fifth place in terms of coking coal exports to Japan.

* Indonesia's 2022 coal output is estimated at between 637 million to 664 million tonnes based on production plans currently being finalised, said Sunindyo Suryo Herdadi, the director at the Energy and Mineral Resources ministry. The figure compared to an output target of 625 million tonnes this year. Domestic demand for coal next year has been estimated at 190 million tonnes.

* Indonesia's Non-Tax State Revenue from the mineral and coal sector set a record high this year. As of December 10, the figure has reached Rp70.05 trillion, or 179.14 percent of the State Budget target of only IDR 39.1 trillion which is the highest non-tax revenue achievement so far. Despite coal's soaring price worldwide, domestic production has actually been slow.

* Indonesia’s coal benchmark prices in December were set 25.7% lower compared to a month earlier, the energy ministry said in a statement. Coal benchmark prices stood at $159.79 per tonne, compared to $215 in November. The lower price was due to higher Chinese coal production, an energy ministry spokesman said in the statement.

US Coal News:

* US coking coal miners expect the fourth-quarter slump in cfr China prices to pass as soon as early 2022, with the market still backed by supply tightness

and steady seaborne demand outside China. Though the sharp price drop has sidelined US miners and suppliers offering into China in recent weeks, margins for coal producers remain attractive and will continue to draw US coals to China.

* The new COVID-19 variant and the increasing number of cases does not seem to be impacting the energy demand, but the supply seems less promising in the US in coming years. So far in 2021, coal is reaching a new level of consumption in the USA while oil is peaking with a new demand figure of 23.3 million barrels per day in the USA despite the onslaught of Omicron.

* Coal production in the U.S. has fallen by half in the last 10 years. Utility companies have been switching to natural gas, which is cheaper, or to renewable energy. However, coal in the US has managed to stage a remarkable recovery this year as Global demand increases for U.S. metallurgical coal has increased manifold. Over half of the metallurgical coal produced in Virginia is actually going overseas. Much of it is headed for China, the world's largest consumer of coal. The US Congress has passed a major infrastructure bill which is expected to provide an even bigger market for coking coal.

* A 20-month high 2.83 million st of coal was exported from the terminals in the Hampton Roads area of Virginia in November. This month’s coal exports were the highest since 2.88 million st in March 2020. The volume was 3.3% higher than October and 24.4% higher than the year-ago month. FOB Hampton Roads 6,000 kcal/kg thermal coal rose to an average $128.23/mt in November, the highest price on record since April 6, 2018.

Pet Coke News:

* Petcoke finally started to give in based on demand pull-back and increased supply as refineries are running on higher capacity utilisation levels. The discounts had disappeared and coal switching was seen in India, China and Turkey. The spot market saw more cargoes and the refineries had to get the petcoke out, now facing a lack of demand based on the lower coal prices. Petcoke finally started to give in based on demand pull-back and increased supply as refineries are running on higher capacity utilisation levels. * The gap between US based High-sulfur and midsulfur petcoke gap is expected to narrow compared with previous weeks because there’s no real interest in mid-sulfur petcoke as China and Turkey are out of the market. Meanwhile, Petcoke deliveries into the Mediterranean region endured another lukewarm week amid concerns over declining import prices which can impact the purchase activity.

Shipping Update:

* 2021 has been a mixed bag for the shipping industry. The dry bulk market fared much better than the tanker one, during 2021. As per detailed review of the Baltic indices (dry/wet) and the second-hand vessel prices, 2021 proved to be robust for dry bulk which reached its highest levels of the past 13 years, back in October 2021. All dry indices began the year at low levels, with the BPI, BSI & BHSI having recorded their lowest levels of 2021 in early January and BDI & BCI during mid-February.

* Global tanker markets are expected to see better days in 2022 on the back of a likely increase in trade of oil and oil products, but the return to a prepandemic era can still be painful due to upcoming deliveries and slower scrapping of old ships. Higher bunker prices are also eroding earnings, though it has been factored in the new world scale flat rates. Nevertheless, vulnerability to future bunker price spikes remains.

* In direct contrast to the new building market, where things have not been that active, the S&P market has been quite vivid. Given the fair number of units changing hands, overall buying appetite has been on an upward orbit. With many interested parties having already taken a relatively bullish stance for the upcoming period, freight earnings are expected to return to more robust levels.

* China shipped in 35.05 million tonnes of coal last month, up from 26.94 million tonnes in October, data from the General Administration of Customs showed. Chinese coal traders, however, were forced to sell cargoes at losses or tried to delay imports after market intervention triggered a 50% price drop that saddled them with unprofitable supplies.