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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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Tuesday, 25 August 20
INDIA'S IMPORTS FALL AS LOCKDOWNS IMPACT THE POWER AND INDUSTRIAL SECTORS - REPORT
India is the world’s second largest thermal coal consumer and importer, importing an estimated 211 million tonnes of thermal coal in 2019.&nb ...
Monday, 24 August 20
A COMBINATION OF DEVELOPMENTS DROVE THE FALLOFF COAL PRICES - CHIEF ECONOMIST’ OFFICE, AUSTRALIA
China, rising domestic production combined with subdued power demand;
India, a lockdown coupled with government directives that fav ...
Monday, 24 August 20
AUSTRALIA'S THERMAL COAL EXPORTS ARE FORECAST TO DROP FROM AN ESTIMATED $20 BILLION IN 2019-20 TO $16 BILLION IN 2020-21: REPORT
Thermal coal spot prices have fallen sharply as the impact of COVID-19 drives a contraction in seaborne trade for only the second time this century ...
Saturday, 22 August 20
REPORT SEES INDIA’S RELIANCE ON THERMAL POWER DROPPING TO 50% IN 2021, 43% IN 2026 - ET ENERGY | IEEFA
India’s dependence on thermal power will reduce to 50 per cent by 2021-22 and 43 per cent by 2026-27 on the back of renewable energy (RE) cap ...
Friday, 21 August 20
323 MILLION ELECTRIC VEHICLES WILL BE ON THE ROADS BY 2040 - WOOD MACKENZIE
Electric vehicle (EV) sales are expected to reach 45 million units per year by 2040, with a total global EV stock of 323 million, according to new ...
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- Coastal Gujarat Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Bangladesh Power Developement Board
- Jindal Steel & Power Ltd - India
- Makarim & Taira - Indonesia
- Indian Energy Exchange, India
- PetroVietnam Power Coal Import and Supply Company
- Sinarmas Energy and Mining - Indonesia
- Indo Tambangraya Megah - Indonesia
- Bukit Baiduri Energy - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Merrill Lynch Commodities Europe
- International Coal Ventures Pvt Ltd - India
- McConnell Dowell - Australia
- Mintek Dendrill Indonesia
- Formosa Plastics Group - Taiwan
- Aditya Birla Group - India
- Ministry of Transport, Egypt
- Orica Australia Pty. Ltd.
- Minerals Council of Australia
- Karbindo Abesyapradhi - Indoneisa
- Bahari Cakrawala Sebuku - Indonesia
- Altura Mining Limited, Indonesia
- Cigading International Bulk Terminal - Indonesia
- Georgia Ports Authority, United States
- Lanco Infratech Ltd - India
- Globalindo Alam Lestari - Indonesia
- PowerSource Philippines DevCo
- Vijayanagar Sugar Pvt Ltd - India
- Baramulti Group, Indonesia
- Parliament of New Zealand
- Gujarat Sidhee Cement - India
- Holcim Trading Pte Ltd - Singapore
- IHS Mccloskey Coal Group - USA
- Sical Logistics Limited - India
- Price Waterhouse Coopers - Russia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Port Waratah Coal Services - Australia
- GVK Power & Infra Limited - India
- Attock Cement Pakistan Limited
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Marubeni Corporation - India
- Coal and Oil Company - UAE
- Rio Tinto Coal - Australia
- Uttam Galva Steels Limited - India
- Independent Power Producers Association of India
- Straits Asia Resources Limited - Singapore
- Wood Mackenzie - Singapore
- Simpson Spence & Young - Indonesia
- Global Green Power PLC Corporation, Philippines
- Singapore Mercantile Exchange
- Energy Development Corp, Philippines
- PNOC Exploration Corporation - Philippines
- Electricity Authority, New Zealand
- IEA Clean Coal Centre - UK
- Kobexindo Tractors - Indoneisa
- Maharashtra Electricity Regulatory Commission - India
- Thiess Contractors Indonesia
- Planning Commission, India
- Mjunction Services Limited - India
- VISA Power Limited - India
- Rashtriya Ispat Nigam Limited - India
- Metalloyd Limited - United Kingdom
- Siam City Cement PLC, Thailand
- Chettinad Cement Corporation Ltd - India
- Ministry of Finance - Indonesia
- Kideco Jaya Agung - Indonesia
- Ambuja Cements Ltd - India
- Banpu Public Company Limited - Thailand
- Wilmar Investment Holdings
- Bharathi Cement Corporation - India
- Cement Manufacturers Association - India
- Kalimantan Lumbung Energi - Indonesia
- Samtan Co., Ltd - South Korea
- Indonesian Coal Mining Association
- Commonwealth Bank - Australia
- Billiton Holdings Pty Ltd - Australia
- Romanian Commodities Exchange
- CNBM International Corporation - China
- White Energy Company Limited
- Edison Trading Spa - Italy
- Antam Resourcindo - Indonesia
- Ministry of Mines - Canada
- Manunggal Multi Energi - Indonesia
- GMR Energy Limited - India
- PTC India Limited - India
- Madhucon Powers Ltd - India
- Barasentosa Lestari - Indonesia
- Salva Resources Pvt Ltd - India
- Bulk Trading Sa - Switzerland
- Thai Mozambique Logistica
- Directorate General of MIneral and Coal - Indonesia
- Mercator Lines Limited - India
- Orica Mining Services - Indonesia
- Anglo American - United Kingdom
- Eastern Energy - Thailand
- Indika Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- Vedanta Resources Plc - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Electricity Generating Authority of Thailand
- Star Paper Mills Limited - India
- Mercuria Energy - Indonesia
- Australian Coal Association
- Semirara Mining and Power Corporation, Philippines
- Trasteel International SA, Italy
- San Jose City I Power Corp, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Economic Council, Georgia
- Bhushan Steel Limited - India
- Videocon Industries ltd - India
- Directorate Of Revenue Intelligence - India
- Sarangani Energy Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Karaikal Port Pvt Ltd - India
- Central Electricity Authority - India
- MS Steel International - UAE
- Interocean Group of Companies - India
- Energy Link Ltd, New Zealand
- LBH Netherlands Bv - Netherlands
- Siam City Cement - Thailand
- Bukit Makmur.PT - Indonesia
- Grasim Industreis Ltd - India
- The State Trading Corporation of India Ltd
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indogreen Group - Indonesia
- Toyota Tsusho Corporation, Japan
- Deloitte Consulting - India
- Bukit Asam (Persero) Tbk - Indonesia
- Eastern Coal Council - USA
- Power Finance Corporation Ltd., India
- Kepco SPC Power Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Sakthi Sugars Limited - India
- ICICI Bank Limited - India
- CIMB Investment Bank - Malaysia
- Tata Chemicals Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Oldendorff Carriers - Singapore
- Goldman Sachs - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Timah Investasi Mineral - Indoneisa
- Ceylon Electricity Board - Sri Lanka
- Essar Steel Hazira Ltd - India
- Standard Chartered Bank - UAE
- Meenaskhi Energy Private Limited - India
- Kumho Petrochemical, South Korea
- Pipit Mutiara Jaya. PT, Indonesia
- Heidelberg Cement - Germany
- Binh Thuan Hamico - Vietnam
- Riau Bara Harum - Indonesia
- Malabar Cements Ltd - India
- Ind-Barath Power Infra Limited - India
- Kaltim Prima Coal - Indonesia
- London Commodity Brokers - England
- The Treasury - Australian Government
- Petron Corporation, Philippines
- Coalindo Energy - Indonesia
- Global Business Power Corporation, Philippines
- European Bulk Services B.V. - Netherlands
- Australian Commodity Traders Exchange
- Central Java Power - Indonesia
- Jaiprakash Power Ventures ltd
- Xindia Steels Limited - India
- SMG Consultants - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Therma Luzon, Inc, Philippines
- Renaissance Capital - South Africa
- South Luzon Thermal Energy Corporation
- Aboitiz Power Corporation - Philippines
- Krishnapatnam Port Company Ltd. - India
- Meralco Power Generation, Philippines
- Sree Jayajothi Cements Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Maheswari Brothers Coal Limited - India
- Intertek Mineral Services - Indonesia
- Borneo Indobara - Indonesia
- Savvy Resources Ltd - HongKong
- Bhatia International Limited - India
- OPG Power Generation Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Sindya Power Generating Company Private Ltd
- Semirara Mining Corp, Philippines
- Africa Commodities Group - South Africa
- Parry Sugars Refinery, India
- Chamber of Mines of South Africa
- Latin American Coal - Colombia
- GAC Shipping (India) Pvt Ltd
- Jorong Barutama Greston.PT - Indonesia
- Dalmia Cement Bharat India
- Leighton Contractors Pty Ltd - Australia
- Iligan Light & Power Inc, Philippines
- TeaM Sual Corporation - Philippines
- Medco Energi Mining Internasional
- Pendopo Energi Batubara - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Posco Energy - South Korea
- The University of Queensland
- Kartika Selabumi Mining - Indonesia
- Indian Oil Corporation Limited
- Tamil Nadu electricity Board
- New Zealand Coal & Carbon
- Bank of Tokyo Mitsubishi UFJ Ltd
- Carbofer General Trading SA - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vizag Seaport Private Limited - India
- Alfred C Toepfer International GmbH - Germany
- Bayan Resources Tbk. - Indonesia
- Agrawal Coal Company - India
- Gujarat Electricity Regulatory Commission - India
- SMC Global Power, Philippines
- India Bulls Power Limited - India
- Bhoruka Overseas - Indonesia
- ASAPP Information Group - India
- Gujarat Mineral Development Corp Ltd - India
- Sojitz Corporation - Japan
- Larsen & Toubro Limited - India
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