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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, 17 June 20
KOREA SOUTHERN POWER CO INVITED 80000 MT OF LOW CALORIFIC VALUE COAL FOR AUGUST 1H, 2020 LOADING
COALspot.com: Korea Southern Power Co., Ltd. (KOSPO) has issued an International tender for 80,000 Metric Tons (MT) Min 4,200 kcal/kg - Max. ...
Tuesday, 16 June 20
A GLOBAL ECONOMIC SLUMP: WHAT WILL IT MEAN FOR METALS AND MINING? - WOOD MACKENZIE
Back before coronavirus knocked “normal” out cold, the key issues for miners were sub-investment prices, rising requirements for ESG an ...
Tuesday, 16 June 20
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX UP 0.58 PCT - XINHUA
China Taiyuan coal transaction price index stood at 124.43 points Monday, up 0.58 percent week on week.
The index, released by China ...
Tuesday, 16 June 20
HIGHER IRON ORE PRICES OFFSET CORONAVIRUS-DRIVEN PRODUCTION RISK - FITCH RATINGS
Lower iron ore production in Brazil, resulting from rising coronavirus infections, should only marginally affect the cash flow of Vale and other gl ...
Tuesday, 16 June 20
SHALE SHOCKED - WOOD MACKENZIE
Capturing shut-ins in real time
Oil markets are searching for balance as the world reflects on the impact of the COVID-19 pandemic. ...
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- Maharashtra Electricity Regulatory Commission - India
- Tata Chemicals Ltd - India
- Aboitiz Power Corporation - Philippines
- Attock Cement Pakistan Limited
- IHS Mccloskey Coal Group - USA
- Bukit Baiduri Energy - Indonesia
- Karaikal Port Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Commonwealth Bank - Australia
- CNBM International Corporation - China
- Semirara Mining Corp, Philippines
- London Commodity Brokers - England
- Global Business Power Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- GN Power Mariveles Coal Plant, Philippines
- Port Waratah Coal Services - Australia
- GVK Power & Infra Limited - India
- IEA Clean Coal Centre - UK
- Samtan Co., Ltd - South Korea
- Anglo American - United Kingdom
- Bhatia International Limited - India
- Australian Commodity Traders Exchange
- Thiess Contractors Indonesia
- Ministry of Finance - Indonesia
- Independent Power Producers Association of India
- Coastal Gujarat Power Limited - India
- Coalindo Energy - Indonesia
- Tamil Nadu electricity Board
- Georgia Ports Authority, United States
- Offshore Bulk Terminal Pte Ltd, Singapore
- Riau Bara Harum - Indonesia
- Xindia Steels Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Planning Commission, India
- Rio Tinto Coal - Australia
- Sarangani Energy Corporation, Philippines
- Oldendorff Carriers - Singapore
- Renaissance Capital - South Africa
- Makarim & Taira - Indonesia
- Wood Mackenzie - Singapore
- Kapuas Tunggal Persada - Indonesia
- Central Java Power - Indonesia
- Central Electricity Authority - India
- Australian Coal Association
- Semirara Mining and Power Corporation, Philippines
- GMR Energy Limited - India
- The State Trading Corporation of India Ltd
- Metalloyd Limited - United Kingdom
- Grasim Industreis Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Salva Resources Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Bhoruka Overseas - Indonesia
- Meenaskhi Energy Private Limited - India
- Parliament of New Zealand
- Bukit Makmur.PT - Indonesia
- Maheswari Brothers Coal Limited - India
- Carbofer General Trading SA - India
- Sical Logistics Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Merrill Lynch Commodities Europe
- Asmin Koalindo Tuhup - Indonesia
- Indian Oil Corporation Limited
- Essar Steel Hazira Ltd - India
- Baramulti Group, Indonesia
- ASAPP Information Group - India
- Manunggal Multi Energi - Indonesia
- Cement Manufacturers Association - India
- Petron Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- Savvy Resources Ltd - HongKong
- Holcim Trading Pte Ltd - Singapore
- Leighton Contractors Pty Ltd - Australia
- Meralco Power Generation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- SMG Consultants - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Uttam Galva Steels Limited - India
- Mintek Dendrill Indonesia
- Orica Mining Services - Indonesia
- Barasentosa Lestari - Indonesia
- Latin American Coal - Colombia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- PNOC Exploration Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Africa Commodities Group - South Africa
- Indonesian Coal Mining Association
- Straits Asia Resources Limited - Singapore
- Power Finance Corporation Ltd., India
- Binh Thuan Hamico - Vietnam
- Formosa Plastics Group - Taiwan
- Globalindo Alam Lestari - Indonesia
- Marubeni Corporation - India
- Edison Trading Spa - Italy
- AsiaOL BioFuels Corp., Philippines
- Madhucon Powers Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Chettinad Cement Corporation Ltd - India
- PowerSource Philippines DevCo
- India Bulls Power Limited - India
- Sree Jayajothi Cements Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Mercator Lines Limited - India
- Borneo Indobara - Indonesia
- Indika Energy - Indonesia
- Vizag Seaport Private Limited - India
- Karbindo Abesyapradhi - Indoneisa
- SMC Global Power, Philippines
- Larsen & Toubro Limited - India
- Parry Sugars Refinery, India
- Energy Link Ltd, New Zealand
- Global Coal Blending Company Limited - Australia
- Kohat Cement Company Ltd. - Pakistan
- Ambuja Cements Ltd - India
- Mercuria Energy - Indonesia
- Heidelberg Cement - Germany
- Toyota Tsusho Corporation, Japan
- Electricity Generating Authority of Thailand
- Rashtriya Ispat Nigam Limited - India
- Kaltim Prima Coal - Indonesia
- Sindya Power Generating Company Private Ltd
- Chamber of Mines of South Africa
- Ministry of Transport, Egypt
- Wilmar Investment Holdings
- LBH Netherlands Bv - Netherlands
- Global Green Power PLC Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Jaiprakash Power Ventures ltd
- Kobexindo Tractors - Indoneisa
- Thai Mozambique Logistica
- Sakthi Sugars Limited - India
- Cigading International Bulk Terminal - Indonesia
- TeaM Sual Corporation - Philippines
- Orica Australia Pty. Ltd.
- Simpson Spence & Young - Indonesia
- Bulk Trading Sa - Switzerland
- Indian Energy Exchange, India
- Eastern Energy - Thailand
- CIMB Investment Bank - Malaysia
- International Coal Ventures Pvt Ltd - India
- Therma Luzon, Inc, Philippines
- Krishnapatnam Port Company Ltd. - India
- MS Steel International - UAE
- Singapore Mercantile Exchange
- Posco Energy - South Korea
- Ind-Barath Power Infra Limited - India
- Banpu Public Company Limited - Thailand
- Goldman Sachs - Singapore
- Bharathi Cement Corporation - India
- SN Aboitiz Power Inc, Philippines
- Medco Energi Mining Internasional
- Jindal Steel & Power Ltd - India
- Kumho Petrochemical, South Korea
- PTC India Limited - India
- Lanco Infratech Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Standard Chartered Bank - UAE
- Agrawal Coal Company - India
- Electricity Authority, New Zealand
- Altura Mining Limited, Indonesia
- Dalmia Cement Bharat India
- Ceylon Electricity Board - Sri Lanka
- Energy Development Corp, Philippines
- Vedanta Resources Plc - India
- Aditya Birla Group - India
- VISA Power Limited - India
- Indogreen Group - Indonesia
- OPG Power Generation Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- South Luzon Thermal Energy Corporation
- Economic Council, Georgia
- McConnell Dowell - Australia
- Kepco SPC Power Corporation, Philippines
- Pendopo Energi Batubara - Indonesia
- Deloitte Consulting - India
- Timah Investasi Mineral - Indoneisa
- San Jose City I Power Corp, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Videocon Industries ltd - India
- Billiton Holdings Pty Ltd - Australia
- Siam City Cement PLC, Thailand
- ICICI Bank Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mjunction Services Limited - India
- GAC Shipping (India) Pvt Ltd
- Kartika Selabumi Mining - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bangladesh Power Developement Board
- New Zealand Coal & Carbon
- Neyveli Lignite Corporation Ltd, - India
- The Treasury - Australian Government
- Gujarat Mineral Development Corp Ltd - India
- Interocean Group of Companies - India
- The University of Queensland
- Antam Resourcindo - Indonesia
- Gujarat Sidhee Cement - India
- Romanian Commodities Exchange
- TNB Fuel Sdn Bhd - Malaysia
- Eastern Coal Council - USA
- Minerals Council of Australia
- Trasteel International SA, Italy
- Bayan Resources Tbk. - Indonesia
- Siam City Cement - Thailand
- Bhushan Steel Limited - India
- Star Paper Mills Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Intertek Mineral Services - Indonesia
- White Energy Company Limited
- European Bulk Services B.V. - Netherlands
- Ministry of Mines - Canada
- Coal and Oil Company - UAE
- Price Waterhouse Coopers - Russia
- Malabar Cements Ltd - India
- Sojitz Corporation - Japan
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