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Tuesday, 01 July 14
INDIAN POWER PLANT COAL STOCKPILES VERY LOW

COALspot.com: According to today's Weekly Dry Bulk Report published by Commodore Research, Indian power plant coal stockpiles have now fallen to approximately 12.9 million tons.  This is the lowest amount of coal stockpiled since February 2013 and is 7.4 million tons (-35%) less than was stockpiled a year ago.  Commodore Research monitors Indian power plant coal stockpiles on daily basis and predicts that Indian coal imports are poised to surge even further during the months ahead (a precise estimate is featured in today's Commodore Research Weekly Dry Bulk Report). 

Low power plant coal stockpiles in India are becoming a big issue, and local officials in India are stating that a greater number of power shortages are expected to occur in the near term.  India’s larger cities, of course, are faring the best whereas access to electricity is concerned but longer power cuts are being reported in rural India and many small cities.  Commodore Research believes that India’s newly elected government is determined to avoid severe power blackouts like the ones that occurred in July 2012. 

On July 30, 2012, India had an extremely large power shortage that reportedly affected as many as 300 million citizens.  July 31, 2012 saw a second (even larger) electricity shortage that reportedly affected as many as 620 million citizens.  These shortages were well documented by the global media and led to a great deal of embarrassment by the Indian government (as well as hardship for Indian citizens).

The following year in 2013, the Indian government was determined to avoid severe blackouts which is why stockpiles were largely kept above 20 million tons during April 2013 all the way through the very end of September 2013.   At present, however, India's power plant coal stockpiles stand at only million tons which is why Commodore Research is predicting an upcoming surge in Indian coal imports.  India is also experiencing a less active rainy season this year, which is limiting hydropower production. 

As a result, Commodore Research anticipates than an even greater proportion of thermal coal derived-electricity production is likely to be needed during the upcoming months to produce enough electricity to meet demand.  Going forward, Indian coal imports are likely to find greater support.
By: Jeffrey Landsberg | Commodore Research & Consultancy

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