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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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Friday, 19 June 20
INDIA'S COAL CONSUMPTION GROWTH IN 2019 SLOWEST SINCE 2001: BP STATS REVIEW - HINDU BUSINESS LINE
Growth in global energy markets slowed in 2019 in line with weaker economic growth, according to the bp Statistical Review of World Energy 2020. Th ...
Friday, 19 June 20
KOWEPO TO IMPORT 1,050,000 MT OF MIN 5300 NCV COAL FOR THREE YEARS
COALspot.com: Korera Western Power Co., Ltd. (KOWEPO) has issued an International tender for Total 1,050k MT Min.5,300 kcal/kg NCV coal for t ...
Thursday, 18 June 20
INDIA: GOVT'S PLAN TO CUT COAL IMPORT GOES FOR A TOSS AS FY20 BREAKS LOGISTICS CHAIN; LOCAL OUTPUT STAGNANT - FINANCIAL EXPRESS
Weak logistics support and disrupted supply chain towards the end of the last financial year 2019-20 hit the government’s plan to cut coal im ...
Thursday, 18 June 20
INDIA: THERMAL PLANTS TO OPERATE BELOW 53% CAPACITY IN FY21 AS POWER DEMAND DIPS - BUSINESS STANDARD
The Plant Load Factor (PLF) of thermal power stations across the country is projected to dip below 53 per cent in this fiscal. Muted power demand f ...
Wednesday, 17 June 20
MARKET INSIGHT - INTERMODAL
After experiencing record earnings during the first half of the year, the focus of headlines concerning the tanker market has shifted from the deve ...
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- Semirara Mining and Power Corporation, Philippines
- Orica Mining Services - Indonesia
- Independent Power Producers Association of India
- Indian Oil Corporation Limited
- Alfred C Toepfer International GmbH - Germany
- Tamil Nadu electricity Board
- Leighton Contractors Pty Ltd - Australia
- PetroVietnam Power Coal Import and Supply Company
- Eastern Energy - Thailand
- Economic Council, Georgia
- Ind-Barath Power Infra Limited - India
- Salva Resources Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Siam City Cement PLC, Thailand
- Jorong Barutama Greston.PT - Indonesia
- IHS Mccloskey Coal Group - USA
- Petron Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Sojitz Corporation - Japan
- Gujarat Mineral Development Corp Ltd - India
- SMG Consultants - Indonesia
- Wood Mackenzie - Singapore
- Indo Tambangraya Megah - Indonesia
- Maheswari Brothers Coal Limited - India
- The Treasury - Australian Government
- Grasim Industreis Ltd - India
- Global Coal Blending Company Limited - Australia
- Standard Chartered Bank - UAE
- Mintek Dendrill Indonesia
- Coastal Gujarat Power Limited - India
- GVK Power & Infra Limited - India
- Edison Trading Spa - Italy
- Georgia Ports Authority, United States
- Directorate General of MIneral and Coal - Indonesia
- European Bulk Services B.V. - Netherlands
- GN Power Mariveles Coal Plant, Philippines
- Toyota Tsusho Corporation, Japan
- Indonesian Coal Mining Association
- GMR Energy Limited - India
- Singapore Mercantile Exchange
- Bharathi Cement Corporation - India
- Krishnapatnam Port Company Ltd. - India
- Madhucon Powers Ltd - India
- IEA Clean Coal Centre - UK
- Asmin Koalindo Tuhup - Indonesia
- Power Finance Corporation Ltd., India
- Meralco Power Generation, Philippines
- South Luzon Thermal Energy Corporation
- Uttam Galva Steels Limited - India
- Coalindo Energy - Indonesia
- Mercuria Energy - Indonesia
- Australian Commodity Traders Exchange
- Directorate Of Revenue Intelligence - India
- Parry Sugars Refinery, India
- Planning Commission, India
- New Zealand Coal & Carbon
- Antam Resourcindo - Indonesia
- Chettinad Cement Corporation Ltd - India
- Central Java Power - Indonesia
- Global Business Power Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Price Waterhouse Coopers - Russia
- Africa Commodities Group - South Africa
- Oldendorff Carriers - Singapore
- Energy Development Corp, Philippines
- Kartika Selabumi Mining - Indonesia
- White Energy Company Limited
- CIMB Investment Bank - Malaysia
- Central Electricity Authority - India
- Sinarmas Energy and Mining - Indonesia
- Intertek Mineral Services - Indonesia
- Kobexindo Tractors - Indoneisa
- Timah Investasi Mineral - Indoneisa
- Kideco Jaya Agung - Indonesia
- Medco Energi Mining Internasional
- Semirara Mining Corp, Philippines
- Parliament of New Zealand
- Eastern Coal Council - USA
- CNBM International Corporation - China
- Ministry of Transport, Egypt
- Star Paper Mills Limited - India
- Iligan Light & Power Inc, Philippines
- Essar Steel Hazira Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Karbindo Abesyapradhi - Indoneisa
- Videocon Industries ltd - India
- Thiess Contractors Indonesia
- Aboitiz Power Corporation - Philippines
- Australian Coal Association
- SMC Global Power, Philippines
- Tata Chemicals Ltd - India
- Trasteel International SA, Italy
- Kapuas Tunggal Persada - Indonesia
- Banpu Public Company Limited - Thailand
- Bulk Trading Sa - Switzerland
- Straits Asia Resources Limited - Singapore
- Coal and Oil Company - UAE
- Bukit Makmur.PT - Indonesia
- Cement Manufacturers Association - India
- Mercator Lines Limited - India
- Gujarat Electricity Regulatory Commission - India
- Pendopo Energi Batubara - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Larsen & Toubro Limited - India
- Interocean Group of Companies - India
- Bhatia International Limited - India
- McConnell Dowell - Australia
- London Commodity Brokers - England
- Renaissance Capital - South Africa
- PTC India Limited - India
- GAC Shipping (India) Pvt Ltd
- ICICI Bank Limited - India
- Dalmia Cement Bharat India
- Malabar Cements Ltd - India
- The State Trading Corporation of India Ltd
- Orica Australia Pty. Ltd.
- Commonwealth Bank - Australia
- Karaikal Port Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Carbofer General Trading SA - India
- Bukit Baiduri Energy - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- MS Steel International - UAE
- Pipit Mutiara Jaya. PT, Indonesia
- Xindia Steels Limited - India
- Sindya Power Generating Company Private Ltd
- Makarim & Taira - Indonesia
- Jindal Steel & Power Ltd - India
- Binh Thuan Hamico - Vietnam
- Romanian Commodities Exchange
- Electricity Generating Authority of Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sical Logistics Limited - India
- Indika Energy - Indonesia
- Samtan Co., Ltd - South Korea
- Formosa Plastics Group - Taiwan
- Neyveli Lignite Corporation Ltd, - India
- Port Waratah Coal Services - Australia
- Energy Link Ltd, New Zealand
- Kumho Petrochemical, South Korea
- Minerals Council of Australia
- Barasentosa Lestari - Indonesia
- Riau Bara Harum - Indonesia
- PowerSource Philippines DevCo
- Wilmar Investment Holdings
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Thai Mozambique Logistica
- Metalloyd Limited - United Kingdom
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sree Jayajothi Cements Limited - India
- Sarangani Energy Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ambuja Cements Ltd - India
- TeaM Sual Corporation - Philippines
- Merrill Lynch Commodities Europe
- Globalindo Alam Lestari - Indonesia
- Deloitte Consulting - India
- The University of Queensland
- Bhushan Steel Limited - India
- Anglo American - United Kingdom
- Siam City Cement - Thailand
- Attock Cement Pakistan Limited
- Indogreen Group - Indonesia
- Therma Luzon, Inc, Philippines
- Marubeni Corporation - India
- Meenaskhi Energy Private Limited - India
- Heidelberg Cement - Germany
- Kohat Cement Company Ltd. - Pakistan
- Electricity Authority, New Zealand
- Rio Tinto Coal - Australia
- Borneo Indobara - Indonesia
- San Jose City I Power Corp, Philippines
- Simpson Spence & Young - Indonesia
- Mjunction Services Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- VISA Power Limited - India
- ASAPP Information Group - India
- Lanco Infratech Ltd - India
- Aditya Birla Group - India
- Kaltim Prima Coal - Indonesia
- Goldman Sachs - Singapore
- Bhoruka Overseas - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Sakthi Sugars Limited - India
- Indian Energy Exchange, India
- Savvy Resources Ltd - HongKong
- Altura Mining Limited, Indonesia
- Baramulti Group, Indonesia
- International Coal Ventures Pvt Ltd - India
- Posco Energy - South Korea
- LBH Netherlands Bv - Netherlands
- Ministry of Finance - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Agrawal Coal Company - India
- Ministry of Mines - Canada
- Bangladesh Power Developement Board
- Chamber of Mines of South Africa
- Rashtriya Ispat Nigam Limited - India
- AsiaOL BioFuels Corp., Philippines
- Bayan Resources Tbk. - Indonesia
- PNOC Exploration Corporation - Philippines
- Miang Besar Coal Terminal - Indonesia
- Global Green Power PLC Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Latin American Coal - Colombia
- SN Aboitiz Power Inc, Philippines
- Kepco SPC Power Corporation, Philippines
- Vizag Seaport Private Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- India Bulls Power Limited - India
- Vedanta Resources Plc - India
- Cigading International Bulk Terminal - Indonesia
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