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8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
1/17
The impact of China’s reduced imports onseaborne coal trade in the Asia-Pacific region
Dr. Fabio GabrieliDirector
Dry Bulk and Energy Commodity Strategist
Coaltrans Japan3-4 September 2015Hilton Tokyo, Shinjuku
8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
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8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
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Agenda
What volumes of coal are being supplied to which
destinations?
How long is global oversupply expected to last?
Is there a replacement for China in sight?
8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
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In 2013 Chinese imports peaked at levels similar to thewhole Atlantic importing demand
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8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
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By the end of the year Chinese imports may drop by90mt vs. 2013 levels, more than 10% of current global
seaborne trade flows
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8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
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AUS growth was pretty diversified, ZAF was forced toswitch tons back to ATL, RUS dumped coal into newmarkets while IDN drop wasn’t only about volume
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8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
7/17
Indonesian output peaked in 2013 and is finally trendingdown…
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8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
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…and by end of the year Indo may lose ~30mt ofbituminous coal vs. 2013 levels due poor economics
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8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
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Is Indo production drop (quality-wise) relevant, when…
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8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
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…continued dollar strengthening…
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8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
11/17
…all time low freight rates, halved diesel prices…
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8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
12/17
…and increasing productivity reduced AUS averageFOB costs by ~40% vs. 2012 levels?
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8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
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So, how low can coal prices go before SnD balances?
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8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
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While global demand falters in 2015-2016 to then add+100mt by 2020…
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…will global supply underperform demand?
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8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
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Will Indo and China “switch” roles thru 2017-2020?
8/16/2019 20150903-Impact of China Reduced Imports on Coal Trade-Mercuria
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Thank you for your attention!Comments and/or questions are welcome…