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Monday, 29 June 20
INDIA COAL IMPORT OUTLOOK: WEAK DEMAND, IMPORT SUBSTITUTION, EXPECT 20% YOY DECLINE - GHEE PEH | IEEFA
 For India, the coal demand indicators have clearly turned negative.
According to Argus Media, since the government declared a nationwide lockdown on 25 March, the country’s daily average power output has been 20% lower than the three-year seasonal average. It estimates power sector coal usage may have fallen by as much as 10mt of NAR 5,000 kcal/kg-equivalent coal to 30mt in April. McCloskey Coal reports that India’s coal stockpile is at 165mt and that nearly half (80mt) is at CIL and other mines. This amount represents 30 to 40 days use. Power plant stocks were at 50mt,which is enough for 29 days. Other indicators, such as imports, domestic coal output, and power and steel output, all point to a large year-on-year decline for India’s coal imports.
Industry observers expect a 20%year-on-yearfall in 2020 India’s coal imports. This is in line with our forecast, but we believe there may be further downside risks. As a result of these, IEEFA expects India to import less Indonesian coal, based on our evaluation of the following four key variables:
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Coal imports: After recording year-on-year growth for January, coal imports experienced year-on-year declines for three months, with March and April down 28% and 29%, respectively.
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Domestic coal production: Coal production from CIL, the largest producer, increased 9.5% year-on-year for the first quarter of 2020.
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Power generation: Thermal power generation fell 1.5% year-on-year in the first quarter of 2020 and total power generation was down 32% year-on-year in April.
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Steel output: From January to April, output was down 20% year-on-year, with April declining 65% year-on-year.
Unlike China, where January to April 2020 coal imports rose, Indian coal imports for the same period were down 18% year-on-year. India’s coal imports have recorded year-on-year declines since February as COIVD-19 disrupted consumption and even the logistics of coal. This is despite average monthly coal benchmark prices falling at least 29% year-on-year over the same period.
According to media reports, CIL’s first quarter of 2020coal production increased 9.5% year-on-year. Although this slowed down to a daily rate of 1.3mt for the first 22 days of April, down 11% year-on-year, these strong gains are bad news for coal exporters to India. The Indian Government has announced measures that are similar to the Chinese Government’s coal import quota. In May, CIL was mandated to replace 100mt (40% of CY2019 coal imports) with domestic non-coking coal for the 2020–21 fiscal year.
For the period January to April2020, India’s total power output was down 7.4% year-on-year and its first quarter 2020 thermal power output was down 1.5% year-on-year. We note that total power output recorded an 8.2% year-on-year decline for March and thermal power output fell 12.9% year-on-year. In April, total power output was down 32.4% year-on-year. Data for thermal power output is not yet available but should also be significantly down, in line with total power output.
These falls would be consistent with the year-on-year decline in coal imports since February and the build-up of stockpiles at CIL and power plants.
India’s steel output acts as an indicator of economic activity. Between January and April, February was the only month that recorded a year-on-year rise in steel output, a modest 1.5%. Steel output recorded year-on-year declines of 13.8% in March and 65.2% in April, due to the full month of lockdown that started on 25 March. Against the backdrop of an increase in domestic coal production in the first quarter of 2020, a build-up of coal stockpiles and a fall in power generation, this level of economic activity presents significant downside risks to India coal imports.
The Indian Government has adopted a policy that supports its domestic coal sector, calling for import reductions. In May 2020, CIL was mandated to replace 100mt of coal (40% of CY 2019 coal imports) with domestic non-coking coal for the 2020–21 fiscal year. CIL’s first quarter 2020 output grew 9.5% year-on-year, presenting a significant risk to Indian coal imports. The risk is greater for Indonesia, because it exports mainly thermal coal. We believe India may have to continue importing coking coal for steel making because its domestic producers mainly supply thermal coal. Industry observers have estimated a 20% year-on-year decline in India’s coal imports. We agree, but also warn that there is a risk of a larger fall.
About IEEFA
The Institute for Energy Economics and Financial Analysis (IEEFA) examines issues related to energy markets, trends and policies. The Institute’s mission is to accelerate the transition to a diverse, sustainable and profitable energy economy. www.ieefa.org
About the Author Ghee Peh
Financial Analyst
Ghee Peh has worked in investment research since 1995, including at Jefferies, BNP Paribas, and UBS. He has covered Asian coal, cement and metal companies.
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Wednesday, 14 April 21
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX DOWN 1.10 PCT - XINHUA
China Taiyuan coal transaction price index stood at 138.05 points Monday, down 1.10 percent week on week.
The index, released by Chi ...
Wednesday, 14 April 21
MARKET INSIGHT - INTERMODAL
After a series of months where the dry bulk sector was attracting most of the buying interest, tankers SnP activity spiked in the previous weeks. O ...
Tuesday, 13 April 21
INDONESIAN COAL PRICE REFERENCE IN APRIL UP AGAIN ON FIRM DEMAND
COALspot.com: The Indonesia coal price reference for April 2021 settles at US$ 86.68 per ton FOB vessel.
The Indonesia coal pr ...
Monday, 12 April 21
CHINA'S ECONOMIC RECOVERY PUSHES COAL MINES TO INCREASE YIELD - GLOBAL TIMES
China’s fast economic rebound from coronavirus has driven up electricity demand, leading to higher consumption of coal which is seeing rising ...
Monday, 12 April 21
GLOBAL COAL PRODUCTION EXPECTED TO RISE BY 3.5% IN 2021, SAYS GLOBALDATA
Global coal output is estimated to have declined by 2% in 2020 due to COVID-19-related lockdowns and restrictions, with significant reductions obse ...
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- McConnell Dowell - Australia
- Power Finance Corporation Ltd., India
- GVK Power & Infra Limited - India
- Global Coal Blending Company Limited - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- GMR Energy Limited - India
- Indonesian Coal Mining Association
- Kideco Jaya Agung - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PTC India Limited - India
- Eastern Energy - Thailand
- Sojitz Corporation - Japan
- CIMB Investment Bank - Malaysia
- Thiess Contractors Indonesia
- Sree Jayajothi Cements Limited - India
- IEA Clean Coal Centre - UK
- Videocon Industries ltd - India
- Bhushan Steel Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Wood Mackenzie - Singapore
- Global Green Power PLC Corporation, Philippines
- Mintek Dendrill Indonesia
- Minerals Council of Australia
- TNB Fuel Sdn Bhd - Malaysia
- Sical Logistics Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Borneo Indobara - Indonesia
- MS Steel International - UAE
- Kobexindo Tractors - Indoneisa
- Manunggal Multi Energi - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Aboitiz Power Corporation - Philippines
- Anglo American - United Kingdom
- Jaiprakash Power Ventures ltd
- Vedanta Resources Plc - India
- Maheswari Brothers Coal Limited - India
- SN Aboitiz Power Inc, Philippines
- Metalloyd Limited - United Kingdom
- Therma Luzon, Inc, Philippines
- The Treasury - Australian Government
- London Commodity Brokers - England
- Iligan Light & Power Inc, Philippines
- Jindal Steel & Power Ltd - India
- Directorate Of Revenue Intelligence - India
- Georgia Ports Authority, United States
- Jorong Barutama Greston.PT - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Parliament of New Zealand
- Cigading International Bulk Terminal - Indonesia
- Petron Corporation, Philippines
- Carbofer General Trading SA - India
- Sindya Power Generating Company Private Ltd
- Parry Sugars Refinery, India
- Indian Oil Corporation Limited
- The State Trading Corporation of India Ltd
- SMG Consultants - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- CNBM International Corporation - China
- Neyveli Lignite Corporation Ltd, - India
- Toyota Tsusho Corporation, Japan
- Orica Australia Pty. Ltd.
- Malabar Cements Ltd - India
- Salva Resources Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Indika Energy - Indonesia
- Coal and Oil Company - UAE
- Central Java Power - Indonesia
- Siam City Cement PLC, Thailand
- Asmin Koalindo Tuhup - Indonesia
- Formosa Plastics Group - Taiwan
- Singapore Mercantile Exchange
- Mercator Lines Limited - India
- Kumho Petrochemical, South Korea
- Merrill Lynch Commodities Europe
- Intertek Mineral Services - Indonesia
- PNOC Exploration Corporation - Philippines
- Electricity Generating Authority of Thailand
- Baramulti Group, Indonesia
- Ministry of Transport, Egypt
- GN Power Mariveles Coal Plant, Philippines
- San Jose City I Power Corp, Philippines
- New Zealand Coal & Carbon
- Commonwealth Bank - Australia
- Sakthi Sugars Limited - India
- SMC Global Power, Philippines
- Tamil Nadu electricity Board
- Posco Energy - South Korea
- Trasteel International SA, Italy
- Karaikal Port Pvt Ltd - India
- Coalindo Energy - Indonesia
- Romanian Commodities Exchange
- Bangladesh Power Developement Board
- Coastal Gujarat Power Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sarangani Energy Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Lanco Infratech Ltd - India
- Bukit Makmur.PT - Indonesia
- Binh Thuan Hamico - Vietnam
- Semirara Mining Corp, Philippines
- Barasentosa Lestari - Indonesia
- GAC Shipping (India) Pvt Ltd
- Directorate General of MIneral and Coal - Indonesia
- Meenaskhi Energy Private Limited - India
- Vizag Seaport Private Limited - India
- Economic Council, Georgia
- Kartika Selabumi Mining - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Renaissance Capital - South Africa
- LBH Netherlands Bv - Netherlands
- Agrawal Coal Company - India
- Edison Trading Spa - Italy
- Indogreen Group - Indonesia
- PowerSource Philippines DevCo
- Globalindo Alam Lestari - Indonesia
- ICICI Bank Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Dalmia Cement Bharat India
- Planning Commission, India
- Electricity Authority, New Zealand
- Makarim & Taira - Indonesia
- White Energy Company Limited
- Uttam Galva Steels Limited - India
- Larsen & Toubro Limited - India
- Gujarat Electricity Regulatory Commission - India
- Bahari Cakrawala Sebuku - Indonesia
- Wilmar Investment Holdings
- Indo Tambangraya Megah - Indonesia
- Rio Tinto Coal - Australia
- Holcim Trading Pte Ltd - Singapore
- AsiaOL BioFuels Corp., Philippines
- Kepco SPC Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Straits Asia Resources Limited - Singapore
- Riau Bara Harum - Indonesia
- Siam City Cement - Thailand
- Standard Chartered Bank - UAE
- European Bulk Services B.V. - Netherlands
- Thai Mozambique Logistica
- Indian Energy Exchange, India
- Mercuria Energy - Indonesia
- Australian Commodity Traders Exchange
- Timah Investasi Mineral - Indoneisa
- Xindia Steels Limited - India
- Chettinad Cement Corporation Ltd - India
- Pendopo Energi Batubara - Indonesia
- OPG Power Generation Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Chamber of Mines of South Africa
- Ministry of Mines - Canada
- Antam Resourcindo - Indonesia
- TeaM Sual Corporation - Philippines
- Latin American Coal - Colombia
- Ind-Barath Power Infra Limited - India
- Simpson Spence & Young - Indonesia
- Oldendorff Carriers - Singapore
- Australian Coal Association
- Gujarat Sidhee Cement - India
- The University of Queensland
- Billiton Holdings Pty Ltd - Australia
- Deloitte Consulting - India
- Leighton Contractors Pty Ltd - Australia
- South Luzon Thermal Energy Corporation
- Samtan Co., Ltd - South Korea
- Bharathi Cement Corporation - India
- Ministry of Finance - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Mjunction Services Limited - India
- Madhucon Powers Ltd - India
- International Coal Ventures Pvt Ltd - India
- Energy Development Corp, Philippines
- Ambuja Cements Ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Price Waterhouse Coopers - Russia
- Kapuas Tunggal Persada - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Bayan Resources Tbk. - Indonesia
- Marubeni Corporation - India
- Bhatia International Limited - India
- Banpu Public Company Limited - Thailand
- Tata Chemicals Ltd - India
- Kaltim Prima Coal - Indonesia
- Central Electricity Authority - India
- IHS Mccloskey Coal Group - USA
- Krishnapatnam Port Company Ltd. - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Essar Steel Hazira Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Star Paper Mills Limited - India
- Africa Commodities Group - South Africa
- Semirara Mining and Power Corporation, Philippines
- Global Business Power Corporation, Philippines
- Bhoruka Overseas - Indonesia
- ASAPP Information Group - India
- Bukit Baiduri Energy - Indonesia
- India Bulls Power Limited - India
- Attock Cement Pakistan Limited
- Gujarat Mineral Development Corp Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Savvy Resources Ltd - HongKong
- Energy Link Ltd, New Zealand
- VISA Power Limited - India
- Eastern Coal Council - USA
- Goldman Sachs - Singapore
- Grasim Industreis Ltd - India
- Port Waratah Coal Services - Australia
- Meralco Power Generation, Philippines
- Cement Manufacturers Association - India
- Ceylon Electricity Board - Sri Lanka
- Interocean Group of Companies - India
- Medco Energi Mining Internasional
- Orica Mining Services - Indonesia
- Aditya Birla Group - India
- Heidelberg Cement - Germany
- Independent Power Producers Association of India
- Bulk Trading Sa - Switzerland
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