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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 October 20
CHINA COKING COAL FUTURES RALLY ON REPORTED BAN ON AUSTRALIA CARGOES - REUTERS
Dalian coking coal futures rallied for a sixth straight session on Tuesday after reports surfaced that China had stopped buying coal from Australia ...
Wednesday, 14 October 20
MARKET INSIGHT - INTERMODAL
The tanker market has experienced severe freight rate and asset value declines over the past 5 months. A potential market upturn may arise in the c ...
Friday, 09 October 20
INDIA'S COAL IMPORTS IMPROVE SOMEWHAT, BUT RECOVERY IS UNEVEN - REUTERS
India’s coal imports, depressed by the impact of coronavirus this year, regained ground in September, but in an uneven uptick – shipmen ...
Thursday, 08 October 20
CHINA'S COAL IMPORTS FROM INDONESIA DECLINED 16.4% Y-O-Y, TO 80.2 MLN TONNES IN THE FIRST 9 MONTHS OF 2020 - BANCHERO COSTA
China's coal imports boomed in 2019, surprising many who had expected the government would clamp down strictly on shipments.
...
Thursday, 08 October 20
GLIMMER OF LIGHT FOR COAL, BUT SHORT TERM - FNARENA
Is coal on the rebound? Demand appears stronger and supply reductions have underpinned a tightening market. Certainly, the Newcastle thermal coal p ...
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- Attock Cement Pakistan Limited
- Central Electricity Authority - India
- Independent Power Producers Association of India
- Malabar Cements Ltd - India
- Kideco Jaya Agung - Indonesia
- Port Waratah Coal Services - Australia
- Standard Chartered Bank - UAE
- Indian Oil Corporation Limited
- Formosa Plastics Group - Taiwan
- Sical Logistics Limited - India
- Heidelberg Cement - Germany
- Power Finance Corporation Ltd., India
- Interocean Group of Companies - India
- Binh Thuan Hamico - Vietnam
- Mercuria Energy - Indonesia
- Kartika Selabumi Mining - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Eastern Energy - Thailand
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- MS Steel International - UAE
- Karaikal Port Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Transport, Egypt
- Sarangani Energy Corporation, Philippines
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- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mjunction Services Limited - India
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- New Zealand Coal & Carbon
- Singapore Mercantile Exchange
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- Bulk Trading Sa - Switzerland
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- Australian Commodity Traders Exchange
- Bhushan Steel Limited - India
- Orica Mining Services - Indonesia
- Coastal Gujarat Power Limited - India
- Sojitz Corporation - Japan
- TeaM Sual Corporation - Philippines
- CNBM International Corporation - China
- Bangladesh Power Developement Board
- Samtan Co., Ltd - South Korea
- Jaiprakash Power Ventures ltd
- Star Paper Mills Limited - India
- Chamber of Mines of South Africa
- ICICI Bank Limited - India
- Indian Energy Exchange, India
- Eastern Coal Council - USA
- Bahari Cakrawala Sebuku - Indonesia
- Salva Resources Pvt Ltd - India
- Indogreen Group - Indonesia
- Parliament of New Zealand
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- Essar Steel Hazira Ltd - India
- SN Aboitiz Power Inc, Philippines
- McConnell Dowell - Australia
- Wood Mackenzie - Singapore
- Economic Council, Georgia
- Commonwealth Bank - Australia
- Energy Development Corp, Philippines
- Semirara Mining Corp, Philippines
- Wilmar Investment Holdings
- Goldman Sachs - Singapore
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Alfred C Toepfer International GmbH - Germany
- Global Coal Blending Company Limited - Australia
- Bukit Baiduri Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Madhucon Powers Ltd - India
- Sindya Power Generating Company Private Ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- Minerals Council of Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Thiess Contractors Indonesia
- Bharathi Cement Corporation - India
- San Jose City I Power Corp, Philippines
- White Energy Company Limited
- Marubeni Corporation - India
- Mintek Dendrill Indonesia
- Australian Coal Association
- The State Trading Corporation of India Ltd
- Globalindo Alam Lestari - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Georgia Ports Authority, United States
- Renaissance Capital - South Africa
- Dalmia Cement Bharat India
- Parry Sugars Refinery, India
- Metalloyd Limited - United Kingdom
- Electricity Authority, New Zealand
- Karbindo Abesyapradhi - Indoneisa
- Xindia Steels Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Meenaskhi Energy Private Limited - India
- GAC Shipping (India) Pvt Ltd
- European Bulk Services B.V. - Netherlands
- Straits Asia Resources Limited - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- AsiaOL BioFuels Corp., Philippines
- Baramulti Group, Indonesia
- Maheswari Brothers Coal Limited - India
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- Indo Tambangraya Megah - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Tata Chemicals Ltd - India
- Iligan Light & Power Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- Leighton Contractors Pty Ltd - Australia
- Pendopo Energi Batubara - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- PowerSource Philippines DevCo
- Ind-Barath Power Infra Limited - India
- Bhatia International Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- London Commodity Brokers - England
- Barasentosa Lestari - Indonesia
- Grasim Industreis Ltd - India
- Therma Luzon, Inc, Philippines
- Jindal Steel & Power Ltd - India
- Simpson Spence & Young - Indonesia
- Ambuja Cements Ltd - India
- Bhoruka Overseas - Indonesia
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- Intertek Mineral Services - Indonesia
- PTC India Limited - India
- Kepco SPC Power Corporation, Philippines
- Kumho Petrochemical, South Korea
- Savvy Resources Ltd - HongKong
- Electricity Generating Authority of Thailand
- Tamil Nadu electricity Board
- Trasteel International SA, Italy
- Medco Energi Mining Internasional
- Aboitiz Power Corporation - Philippines
- GN Power Mariveles Coal Plant, Philippines
- Latin American Coal - Colombia
- Altura Mining Limited, Indonesia
- The Treasury - Australian Government
- OPG Power Generation Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Edison Trading Spa - Italy
- IEA Clean Coal Centre - UK
- Posco Energy - South Korea
- Larsen & Toubro Limited - India
- Sree Jayajothi Cements Limited - India
- Manunggal Multi Energi - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Chettinad Cement Corporation Ltd - India
- LBH Netherlands Bv - Netherlands
- Africa Commodities Group - South Africa
- Price Waterhouse Coopers - Russia
- Rio Tinto Coal - Australia
- Vedanta Resources Plc - India
- PetroVietnam Power Coal Import and Supply Company
- Global Business Power Corporation, Philippines
- Agrawal Coal Company - India
- Neyveli Lignite Corporation Ltd, - India
- Directorate General of MIneral and Coal - Indonesia
- Meralco Power Generation, Philippines
- Timah Investasi Mineral - Indoneisa
- Vijayanagar Sugar Pvt Ltd - India
- CIMB Investment Bank - Malaysia
- GVK Power & Infra Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Coal and Oil Company - UAE
- Toyota Tsusho Corporation, Japan
- Romanian Commodities Exchange
- ASAPP Information Group - India
- The University of Queensland
- Coalindo Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- SMG Consultants - Indonesia
- Merrill Lynch Commodities Europe
- Ministry of Mines - Canada
- Bukit Makmur.PT - Indonesia
- Riau Bara Harum - Indonesia
- Indonesian Coal Mining Association
- Miang Besar Coal Terminal - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Uttam Galva Steels Limited - India
- Energy Link Ltd, New Zealand
- Planning Commission, India
- VISA Power Limited - India
- Petron Corporation, Philippines
- Cement Manufacturers Association - India
- Maharashtra Electricity Regulatory Commission - India
- SMC Global Power, Philippines
- Central Java Power - Indonesia
- Sakthi Sugars Limited - India
- India Bulls Power Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Banpu Public Company Limited - Thailand
- Gujarat Electricity Regulatory Commission - India
- Makarim & Taira - Indonesia
- South Luzon Thermal Energy Corporation
- Sinarmas Energy and Mining - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Anglo American - United Kingdom
- Orica Australia Pty. Ltd.
- Ministry of Finance - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Kobexindo Tractors - Indoneisa
- Kaltim Prima Coal - Indonesia
- Carbofer General Trading SA - India
- GMR Energy Limited - India
- Aditya Birla Group - India
- Deloitte Consulting - India
- Cigading International Bulk Terminal - Indonesia
- IHS Mccloskey Coal Group - USA
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