The future of our South Asia price assessments
The future of CFR Bangladesh coal price assessment will have a growing importance in the South Asia region due to increasing needs of imported coal for power consumption, the brick sector and trading purposes.
Moreover, there will be a shift from medium and long term contracts to spot trading activities in the region to maintain high-efficiency energy utilization while maintaining a low cost of electricity in the developing countries. As Platts shifts its focus away from a FOB dominated to a more CFR centric market, CFR Bangladesh will accompany CFR Pakistan to give the company a clearer direction in alignment with the evolving market dynamics, and a further redirection of global thermal coal assessments. Similarly for Pakistan, the future of CFR Pakistan coal price assessment is expected to have a huge significance in the South Asia region due to the increasing levels of imported thermal coal as the country’s key determinant lies within the realization of coal-fired power plant projects which are almost 100% dependent on imported coal; they are the main drivers of coal demand in Pakistan.
How our South Asia prices complement other assessments
In South Asia, Bangladesh absorbs mid-cv coal mainly from Indonesian and South African origins. The country’s buying behavior complements with other types of coal such as the Platts FOB Kalimantan 5,000 kcal/kg GAR coal and South African 5,500 kcal/kg NAR coal assessments as seaborne coal are priced more competitively than its domestic materials. Indonesian coal has a lower ash content compared to the South African materials, which improves on the efficiency of boiler and specific fuel consumption. Conversely, South African coal has lower moisture content compared to the Indonesian materials, which decreases the unburned carbon fraction, improves plant performance and reduces carbon emissions. Similarly, Pakistan absorbs high-cv coal mainly from Indonesian and South African origins. However, buying activity ranges from 5,700 kcal/kg NAR to 6,000 kcal/kg NAR coal. In 2019, South Africa accounted for 80% of all thermal coal imports into Pakistan, which bodes well with the daily EMEA Richards Bay coal assessments. Other than South Africa as the main coal supplier, Indonesia supplied 10%, Russia 7% and the US supplied 3% to Pakistan, where the CFR Pakistan price assessment with a 30-60 days window captures information on coal from various origins.