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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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Sunday, 30 August 20
PANAMAX - THIS WEEK THE DEMAND HAS PICKED UP, BUT THE TONNAGE LIST IS INCREASING DAY BY DAY - FEARNLEYS
Cape Size
More or less flat from previous week, with cape rates moving from US$ 19,500 to 18,900 on average. West Australia however being more ...
Saturday, 29 August 20
COAL INDIA'S FUEL SUPPLY TO POWER SECTOR DROPS ABOUT 20% IN APR-JUL: PTI
State-owned Coal India”s fuel supply to the power sector registered a decline of 19.5 per cent to 126.30 million tonnes (MT) in the April-Jul ...
Saturday, 29 August 20
SOUTH KOREAN BROKERAGE FIRM KOREA INVESTMENT & SECURITIES TO STOP ALL COAL BUSINESS - KOREA HERALD
South Korean brokerage firm Korea Investment & Securities has decided to stop its investments in coal, in line with the Moon Jae-in administrat ...
Thursday, 27 August 20
KOREAN GENCOS INVITED BIDS FOR TOTAL 985,000 TONS OF BITUMINOUS COAL FOR NOVEMBER 2020 LOADING
COALspot.com: Korea Midland Power Co., Ltd (KOMIPO) on behalf of EWP, KOSPO, KOSEP and KOWEPO has issued an international tender for total 985,000 ...
Thursday, 27 August 20
SOUTHEAST ASIAN NATIONS SET REGION-WIDE RENEWABLE ENERGY GOAL OF 23 PERCENT BY 2025 - ASEAN POST
The Association of Southeast Asian Nations (ASEAN) has set an ambitious target of securing 23 percent of its primary energy from renewable so ...
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- Bhatia International Limited - India
- PNOC Exploration Corporation - Philippines
- Ambuja Cements Ltd - India
- Australian Coal Association
- Metalloyd Limited - United Kingdom
- Mercator Lines Limited - India
- Indian Oil Corporation Limited
- Leighton Contractors Pty Ltd - Australia
- Parliament of New Zealand
- Wilmar Investment Holdings
- Agrawal Coal Company - India
- Star Paper Mills Limited - India
- Bangladesh Power Developement Board
- GN Power Mariveles Coal Plant, Philippines
- Electricity Authority, New Zealand
- Karaikal Port Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Lanco Infratech Ltd - India
- Larsen & Toubro Limited - India
- Coalindo Energy - Indonesia
- Power Finance Corporation Ltd., India
- Bharathi Cement Corporation - India
- Makarim & Taira - Indonesia
- Semirara Mining Corp, Philippines
- Salva Resources Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- PTC India Limited - India
- McConnell Dowell - Australia
- Coastal Gujarat Power Limited - India
- Rashtriya Ispat Nigam Limited - India
- Mjunction Services Limited - India
- Alfred C Toepfer International GmbH - Germany
- Barasentosa Lestari - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- CNBM International Corporation - China
- GMR Energy Limited - India
- Antam Resourcindo - Indonesia
- SN Aboitiz Power Inc, Philippines
- Medco Energi Mining Internasional
- Price Waterhouse Coopers - Russia
- Kobexindo Tractors - Indoneisa
- Parry Sugars Refinery, India
- Energy Link Ltd, New Zealand
- Heidelberg Cement - Germany
- Pipit Mutiara Jaya. PT, Indonesia
- TeaM Sual Corporation - Philippines
- Oldendorff Carriers - Singapore
- Cement Manufacturers Association - India
- Indo Tambangraya Megah - Indonesia
- Ministry of Finance - Indonesia
- Bulk Trading Sa - Switzerland
- Coal and Oil Company - UAE
- Holcim Trading Pte Ltd - Singapore
- LBH Netherlands Bv - Netherlands
- South Luzon Thermal Energy Corporation
- Bukit Makmur.PT - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Gujarat Mineral Development Corp Ltd - India
- Jindal Steel & Power Ltd - India
- Semirara Mining and Power Corporation, Philippines
- ASAPP Information Group - India
- Anglo American - United Kingdom
- Altura Mining Limited, Indonesia
- Riau Bara Harum - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Eastern Energy - Thailand
- Central Electricity Authority - India
- Global Green Power PLC Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Jorong Barutama Greston.PT - Indonesia
- London Commodity Brokers - England
- Essar Steel Hazira Ltd - India
- Jaiprakash Power Ventures ltd
- Renaissance Capital - South Africa
- Global Business Power Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sree Jayajothi Cements Limited - India
- Orica Mining Services - Indonesia
- Iligan Light & Power Inc, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kideco Jaya Agung - Indonesia
- Meenaskhi Energy Private Limited - India
- Chettinad Cement Corporation Ltd - India
- Siam City Cement - Thailand
- Samtan Co., Ltd - South Korea
- Manunggal Multi Energi - Indonesia
- Africa Commodities Group - South Africa
- Aboitiz Power Corporation - Philippines
- Attock Cement Pakistan Limited
- VISA Power Limited - India
- Thai Mozambique Logistica
- Vijayanagar Sugar Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Independent Power Producers Association of India
- Energy Development Corp, Philippines
- Savvy Resources Ltd - HongKong
- GAC Shipping (India) Pvt Ltd
- The Treasury - Australian Government
- Vizag Seaport Private Limited - India
- Kumho Petrochemical, South Korea
- Bayan Resources Tbk. - Indonesia
- Baramulti Group, Indonesia
- Mercuria Energy - Indonesia
- Petron Corporation, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Rio Tinto Coal - Australia
- Gujarat Sidhee Cement - India
- Bhoruka Overseas - Indonesia
- IEA Clean Coal Centre - UK
- Bukit Baiduri Energy - Indonesia
- Latin American Coal - Colombia
- Meralco Power Generation, Philippines
- Eastern Coal Council - USA
- Deloitte Consulting - India
- Ceylon Electricity Board - Sri Lanka
- Kepco SPC Power Corporation, Philippines
- White Energy Company Limited
- New Zealand Coal & Carbon
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Billiton Holdings Pty Ltd - Australia
- Karbindo Abesyapradhi - Indoneisa
- Indian Energy Exchange, India
- Ministry of Mines - Canada
- IHS Mccloskey Coal Group - USA
- Cigading International Bulk Terminal - Indonesia
- European Bulk Services B.V. - Netherlands
- Formosa Plastics Group - Taiwan
- Port Waratah Coal Services - Australia
- Binh Thuan Hamico - Vietnam
- Sical Logistics Limited - India
- Timah Investasi Mineral - Indoneisa
- Thiess Contractors Indonesia
- Romanian Commodities Exchange
- Australian Commodity Traders Exchange
- Wood Mackenzie - Singapore
- Indika Energy - Indonesia
- Carbofer General Trading SA - India
- Grasim Industreis Ltd - India
- Sakthi Sugars Limited - India
- Kohat Cement Company Ltd. - Pakistan
- PowerSource Philippines DevCo
- ICICI Bank Limited - India
- Goldman Sachs - Singapore
- Tata Chemicals Ltd - India
- Central Java Power - Indonesia
- Interocean Group of Companies - India
- AsiaOL BioFuels Corp., Philippines
- Aditya Birla Group - India
- Georgia Ports Authority, United States
- Bhushan Steel Limited - India
- SMC Global Power, Philippines
- Sojitz Corporation - Japan
- Vedanta Resources Plc - India
- Maharashtra Electricity Regulatory Commission - India
- Dalmia Cement Bharat India
- Directorate Of Revenue Intelligence - India
- Posco Energy - South Korea
- Chamber of Mines of South Africa
- Sinarmas Energy and Mining - Indonesia
- Economic Council, Georgia
- San Jose City I Power Corp, Philippines
- Krishnapatnam Port Company Ltd. - India
- Tamil Nadu electricity Board
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Malabar Cements Ltd - India
- Global Coal Blending Company Limited - Australia
- The University of Queensland
- Miang Besar Coal Terminal - Indonesia
- Banpu Public Company Limited - Thailand
- Kartika Selabumi Mining - Indonesia
- Straits Asia Resources Limited - Singapore
- Singapore Mercantile Exchange
- MS Steel International - UAE
- Borneo Indobara - Indonesia
- Planning Commission, India
- Standard Chartered Bank - UAE
- Toyota Tsusho Corporation, Japan
- Electricity Generating Authority of Thailand
- Mintek Dendrill Indonesia
- Asmin Koalindo Tuhup - Indonesia
- GVK Power & Infra Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Edison Trading Spa - Italy
- The State Trading Corporation of India Ltd
- Madhucon Powers Ltd - India
- Orica Australia Pty. Ltd.
- Kaltim Prima Coal - Indonesia
- India Bulls Power Limited - India
- CIMB Investment Bank - Malaysia
- Indogreen Group - Indonesia
- Siam City Cement PLC, Thailand
- Uttam Galva Steels Limited - India
- Sarangani Energy Corporation, Philippines
- Marubeni Corporation - India
- Ministry of Transport, Egypt
- International Coal Ventures Pvt Ltd - India
- Globalindo Alam Lestari - Indonesia
- OPG Power Generation Pvt Ltd - India
- Videocon Industries ltd - India
- Pendopo Energi Batubara - Indonesia
- SMG Consultants - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Therma Luzon, Inc, Philippines
- Minerals Council of Australia
- Indonesian Coal Mining Association
- Kapuas Tunggal Persada - Indonesia
- Trasteel International SA, Italy
- Ind-Barath Power Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Commonwealth Bank - Australia
- Simpson Spence & Young - Indonesia
- Xindia Steels Limited - India
- Intertek Mineral Services - Indonesia
- Maheswari Brothers Coal Limited - India
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