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China to further tighten coal quality controls on 1 July

Source: www.chinamining.org   Citation: EconoTimes   Date: June 25, 2015

China`s move to tighten coal quality, effective 1 January 2015, led to a significant decline in China`s coal imports in Q1.

Coal imports consumed by the domestic market were limited to coal with ash content below 40% and sulphur content below 3%. Testing at ports initially took 15 days, resulting in a cargo pile-up. Due to these restrictions, China`s Q1-2015 imports from Indonesia fell 47% y/y to 19mt, the lowest for a quarter since Q1-2011.

Indonesia was China`s largest coal supplier (106mt) in 2014. China is tightening its coal quality controls further, with effect from 1 July 2015.

The stricter criteria now extend to all saleable coal - either domestically produced or imported - in the China market, with the new specifications even stricter than those enforced on 1 January.

Coal quality is likely to be tested at ports and at the point of utilization, namely at power utilities and chemical industries. We see this as a broad-based approach to ease China`s pollution woes and reduce carbon emissions, rather than an effort to further restrict coal import volumes to rebalance the domestic oversupplied market.

As such, while shipment delays are expected, China`s imports from Indonesia are not expected to decline significantly as a result of stricter coal quality control.

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises.

CHINA MINING Congress and Expo 2015 will be held at Meijiang Convention and Exhibition Center in Tianjin on November 20^th-23^rd, 2015. We invite you to join the event and to celebrate the 17^th anniversary of CHINA MINING with us.  For more information about CHINA MINING 2015, please visit: www.chinaminingtj.org.

Imported iron ore prices fall

Source: www.chinamining.org   Citation: Xinhua   Date: June 24, 2015

Prices of imported iron ore at 33 major Chinese ports fell last week due to weak demand, a report showed on Tuesday. For the week ending June 22, the price index for imported iron ore of 62-percent purity dropped four points from the previous week to 61. The index for iron ore of 58-percent purity fell four points to 55, according to the Xinhua-China Iron Ore Index.

Inventories of imported iron ore stood at 78.83 million tonnes, down 1.41 million tonnes, or 1.56 percent, from the previous period (June 9 to 15).

The report said the slide in steel prices will continue to weigh on prices of imported iron ore.

China produced less steel in the first quarter of 2015 as demand shrank amid a slowing economy and government moves to overhaul the saturated sector, official data showed.

The index tracks changes in the domestic iron ore market on the basis of surveys of major sea ports, iron ore traders, steel makers and customs statistics.

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises.

CHINA MINING Congress and Expo 2015 will be held at Meijiang Convention and Exhibition Center in Tianjin on November 20^th-23^rd, 2015. We invite you to join the event and to celebrate the 17^th anniversary of CHINA MINING with us.  For more information about CHINA MINING 2015, please visit: www.chinaminingtj.org.

China crude oil output up 1.7 pct

Source: www.chinamining.org   Citation: Xinhua   Date: June 24, 2015

Crude oil output in China reached 87.69 million tonnes in the first five months of 2015, a year on year increase of 1.7 percent, according to the top economic planner. China refined 195.26 million tonnes of crude oil during the period, up 3.8 percent year on year, while refined oil production rose 6 percent to 123.55 million tonnes, the National Development and Reform Commission said in an online statement.

Apparent consumption of refined oil, calculated as production plus imports minus exports, increased 4.4 percent from a year earlier to 113.04 million tonnes.

In a separate statement, the planner said natural gas output totaled 55.5 billion cubic meters during the January-May period, up 4 percent year on year.

Imports of natural gas saw an increase of 5.6 percent to 24.7 billion cubic meters, while apparent consumption came in at 77.2 billion cubic meters, the commission said.

China`s appetite for energy has grown substantially amid rapid industrialization and urbanization.

Domestic crude oil output is expected to grow by 0.4 percent to reach 217 million tonnes in 2015, while refined oil and natural gas output will reach 294 million tonnes and 134.4 billion cubic meters respectively, according to a report released by a research center and a publishing house with the Chinese Academy of Social Sciences earlier this month.

Meanwhile, refined oil net exports are estimated to reach 20.8 million tonnes, up 41.9 percent year on year, with export of diesel taking the lead, the report said

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises.

CHINA MINING Congress and Expo 2015 will be held at Meijiang Convention and Exhibition Center in Tianjin on November 20^th-23^rd, 2015. We invite you to join the event and to celebrate the 17^th anniversary of CHINA MINING with us.  For more information about CHINA MINING 2015, please visit: www.chinaminingtj.org.

Possible two-year wait for China to eliminate thermal coal import tariff

Source: www.chinamining.org   Citation: Platts   Date: June 18, 2015

Australian thermal coal shippers such as BHP Billiton, Glencore, Peabody Energy and Rio Tinto may potentially have to wait until June 2017 for China to eliminate its 6% tariff on imports of Australian thermal coal, the Australian government said in a statement Wednesday.

Marking the official signing of Australia`s free-trade agreement with China Wednesday, the statement issued by Canberra said: "The tariffs on coking coal will be removed on day one, with the tariff on thermal coal being phased out over two years."

Beijing introduced a 6% tariff on Australian thermal coal arriving in Chinese ports last October, and importers in China have effectively passed its cost back to coal shippers in Australia.

At the same time last year, China imposed the 3% import tax on Australian coking coal imports that is now being lifted.

The import tariff has shielded China`s domestic coal industry from the competitive threat of seaborne-traded thermal coal from Australia -- China`s largest supplier -- and other exporters such as Russia and South Africa. Indonesian thermal coal is exempt from China`s import tax because of a pre-existing free trade deal.

Australia shipped A$9.3 billion ($7.2 billion) worth of coal exports to China in the fiscal year 2013-14, comprising around A$5.9 billion of coking coal and A$3.5 billion of thermal coal.

The China-Australian Free Trade Agreement is billed as a launchpad for increased trade between the two countries, the value of which totaled A$160 billion in fiscal 2013-14, the Australian government in its statement.

"On day one of the China-Australia Free Trade Agreement, more than 85% of Australian goods exports will be tariff free, rising to 95% on full implementation," it added.

China has agreed to immediately remove tariffs on some resource products such as its 8% tax on Australian aluminum oxide, which will benefit Australian exporters to the tune of A$1.3 billion a year, the Australian government said. Tariffs on Australian manufactured goods such as automotive engines and pharmaceuticals are also being phased out by China.

Canberra has in the past year implemented free-trade agreements with Japan and South Korea which, together with the latest one with China, mean 55% of Australian exports are now covered by such agreements.

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises.

CHINA MINING Congress and Expo 2015 will be held at Meijiang Convention and Exhibition Center in Tianjin on November 20^th-23^rd, 2015. We invite you to join the event and to celebrate the 17^th anniversary of CHINA MINING with us.  For more information about CHINA MINING 2015, please visit: www.chinaminingtj.org.

China`s aluminum import premiums rangebound at $90-$110/mt CFR

Source: www.chinamining.org   Citation: Platts   Date: June 18, 2015

Chinese import premiums for Good Western aluminum remained rangebound this week at $90-$110/mt CFR plus LME cash, amid a prevailing lack of import interest.

Offers CIF Shanghai and ex-bonded warehouse Shanghai were heard Wednesday at $120-$140/mt, but no trades were reported as buyers anticipated further falls in the near term.

"Everyone is waiting for the third quarter contract talks in Japan to settle, as talking levels are all around $100/mt and below now, so they expect premiums to fall further," a Shanghai-based trader said.

Another Shanghai-based trader said Japan spot premiums are also now trading below $100/mt, "so all signs are pointing downwards for Q3 as well...we might get clearer direction next week."

An east China consumer said Wednesday that even $80-$100/mt CIF China is now too high, as domestic metal prices are weak and the outlook dim.

"Maybe if premiums were at $30-$40/mt CIF China now, we could consider buying," the consumer said.

The LME official cash price closed at $1,660.50-$1,661.00/mt on Tuesday, down from $1,722.50-$1,723.00/mt a week ago.

At $1,661/mt, with the current $90-$110/mt premiums, and taking into consideration 17% VAT, the delivered price to China would equate to Yuan 12,802-12,947/mt ($2,093-$2,117).

On Wednesday, the Changjiang spot aluminum price was trading at Yuan 12,550-12,600/mt.

The front-month July aluminum contract on the Shanghai Futures Exchange closed at Yuan 12,635/mt, down from Yuan 12,785/mt last week.

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises.

CHINA MINING Congress and Expo 2015 will be held at Meijiang Convention and Exhibition Center in Tianjin on November 20^th-23^rd, 2015. We invite you to join the event and to celebrate the 17^th anniversary of CHINA MINING with us.  For more information about CHINA MINING 2015, please visit: www.chinaminingtj.org.

China`s steel industry going into reverse as output slides

Source: www.chinamining.org   Citation: Bloomberg   Date: June 12, 2015

China`s steelmakers reduced output as prices slid to record lows on slowing property and infrastructure construction in the world`s biggest producer.

Crude steel production in May fell 1.7 percent from a year earlier to 69.95 million tons, according to data from the National Bureau of Statistics on Thursday. Output on a daily basis fell 1.8 percent from April.

The slide underscores weakening domestic demand as China seeks to shift away from investment-led growth to a consumption- driven economy, deepening a slowdown in construction. Production during the first five months of the year declined 1.6 percent.

"The second quarter has been even tougher than the first for the mills," said Daniel Kang, an analyst at JPMorgan Chase & Co. in Hong Kong. "Apparent consumption, when you exclude exports, has fallen more than 5 percent this year and this highlights that the economic transition to a new normal is affecting early-cycle commodities such as steel."

China`s total industrial output rose 6.1 percent while fixed-asset investment grew at a slower-than-estimated 11.4 percent, statistics bureau data showed. New property construction starts slid 16 percent in the first five months of the year.

About 70 percent of the country`s steel demand is related to property, infrastructure and machinery manufacturing, according to Helen Lau, an analyst at Argonaut Securities (Asia) Ltd.

Falling Prices

Prices of some steel products have fallen to a 12-year low, spurring Chinese producers to cut output to stem losses or sell at competitive prices overseas. China`s exports of steel products surged to a four-month high in May and are up 28 percent in the first five months of this year, customs data showed Monday.

The slowdown in China`s steel industry has coincided with a surge in supply of iron ore, pushing prices of the steelmaking raw material down as much as 34 percent this year. A rebound in the iron ore market from early April has taken the price to the highest since January 23, according to data from Metal Bulletin, squeezing profitability at China`s steel mills.

Spot prices of reinforcement bar, used in construction, fell 0.2 percent to 2,332 yuan a ton, the lowest since Beijing Antaike Information Development Co. began compiling data in 2003. Rebar for October on the Shanghai Futures Exchange rose 0.8 percent to close at 2,355 yuan a ton.

Steel mills in China face "massive losses" as prices decline while demand reaches its seasonal low during the summer months, according to a Bloomberg Intelligence report Wednesday.

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises.

CHINA MINING Congress and Expo 2015 will be held at Meijiang Convention and Exhibition Center in Tianjin on November 20^th-23^rd, 2015. We invite you to join the event and to celebrate the 17^th anniversary of CHINA MINING with us.  For more information about CHINA MINING 2015, please visit: www.chinaminingtj.org.

China`s lower gas demand growth leaves NOCs facing oversupply: WoodMac

Source: www.chinamining.org   Citation: Platts   Date: June 11, 2015

China`s 2020-2030 gas demand is expected to be 13% lower than previously forecast, which will lead to an oversupplied market and weaker prices, consultancy Wood Mackenzie said in a report Wednesday.

The country`s gas is now expected to be about 360 Bcm in 2020 and 560 Bcm in 2030, down from previous forecasts of 420 Bcm and 640 Bcm, respectively, due to short-term and structural drivers, WoodMac said.

"Short-term drivers include low oil prices and high domestic gas prices, reversal of environmental policies, competition from coal and hydro and warmer winter weather," said Gavin Thompson, WoodMac`s principal gas consultant.

"Structural factors include the switch from industrial production to the service sector as a driver of economic growth."

Despite weakening demand growth, Central Asian volumes into China are continuing to rise.

"As a result, there is an oversupply of contracted LNG into the market, particularly during periods of low seasonal demand," Thompson said.

"We expect China will be over-contracted by about 18 Bcm from 2015 till 2017."

Chinese national oil companies are now pursuing numerous channels to reduce volumes, including efforts to renegotiate ramp-up schedules and pricing terms, and reselling volumes into the Pacific market where agreement can be reached with suppliers, WoodMac said.

Sinopec in particular, as the last of the state-owned buyers to enter the LNG arena, is exploring its options to resell volumes, as it struggles to bring its downstream infrastructure online fast enough to absorb contracted volumes of LNG.

Sinopec is widely reported to be offering up to 4 million mt/year of its existing 7.6 million/mt long-term contract with ConocoPhillips to other Asia-Pacific buyers and portfolio sellers, including BP.

The volumes will originate from the ConocoPhillips-operated Australian Pacific LNG facility in Queensland, which is scheduled to come on stream in September.

According to market sources, Sinopec has also not ruled out the possibility of trading APLNG volumes from 2016 onward, an option that is also being explored by fellow state-owned LNG buyers CNOOC and PetroChina where term contracts allow.

WoodMac believes the NOCs will have three levers to optimize supply and minimize losses.

First, they may restrict domestic investment in more expensive developments and defer investment until demand recovers.

PetroChina will also manage overall volumes of pipeline imports using take-or-pay provisions, with the potential for spot volumes above take-or-pay during periods of peak demand.

Third, the NOCs will maximize contracted LNG volumes to sell into the domestic market as term and spot prices look competitive against regulated city gate tariffs due to low oil prices.

"With strong growth in contracted LNG and low LNG prices, we continue to expect that some volumes of LNG will be re-sold back into the broader market," Thompson said.

Some of these sales will be seasonal, particularly LNG that might otherwise have supplied northern China during the warmer months. But even at times of higher demand it is unlikely that all contracted LNG will find a market in China, according to WoodMac.

An oil price recovery ought to stimulate Chinese gas demand and create more market space for LNG, but the timing of this is uncertain, the consultancy said.

"Given the uncertainties around the market outlook however, we believe that all options must remain on the table," Thompson added.

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises.

CHINA MINING Congress and Expo 2015 will be held at Meijiang Convention and Exhibition Center in Tianjin on November 20^th-23^rd, 2015. We invite you to join the event and to celebrate the 17^th anniversary of CHINA MINING with us.  For more information about CHINA MINING 2015, please visit: www.chinaminingtj.org.

China becomes largest buyer of Brazilian oil: report

Source: www.chinamining.org   Citation: Xinhua   Date: June 10, 2015

Brazil`s oil exports to China increased threefold in the first five months of this year, making Beijing the largest consumer of Brazilian oil in the world, said daily Folha de Sao Paulo on Tuesday.

According to Folha, Brazil exported 5.4 million tons of oil to China from January to May, accounting for 35 percent of Brazil`s total oil exports in the same period. The amount of oil shipped to China is twice as much as that to the United States.

The rise in China`s purchase of Brazilian oil came at a time when Brazil`s state-controlled oil giant Petrobras tried to boost its relations with China. Petrobras signed some financing agreements with China during a recent visit to Brazil by Chinese Premier Li Keqiang.

China`s higher demand for oil also helped Brazil achieve record oil exports of 15 million tons from January to May, up 80 percent from the same period last year.

However, as oil prices have fallen significantly over the past months, the record sales did not generate corresponding high revenues.

With increased oil purchases, China has become the largest buyer of four major Brazilian products. The other three are soybeans, iron ore and cellulose.

China replaced the United States to become Brazil`s largest trade partner in 2009. The Sino-Brazilian trade value amounted to 86.67 billion U.S. dollars in 2014.

About CHINA MINING

Since first held in 1999, the scope and influence of CHINA MINING has grown rapidly year by year. As a global mining summit forum and exhibition, CHINA MINING Congress and Expo has become one of the world’s top mining events, and one of the world’s largest mining exploration, development and trading platforms, covering all aspects of the whole mining industry chain, including geological survey, exploration and development, mining rights trading, mining investment and financing, smelting and processing, mining techniques and equipment, mining services, etc. playing an active promotion role in creating exchange opportunities and enhancing mutual cooperation between domestic and foreign mining enterprises.

CHINA MINING Congress and Expo 2015 will be held at Meijiang Convention and Exhibition Center in Tianjin on November 20^th-23^rd, 2015. We invite you to join the event and to celebrate the 17^th anniversary of CHINA MINING with us.  For more information about CHINA MINING 2015, please visit: www.chinaminingtj.org.