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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, 14 June 20
INDONESIAN COAL WAS STILL IN DEMAND; A 52,000-DWT SUPRAMAX FIXING DELIVERY CJK FOR A ROUND VOYAGE VIA INDONESIA AT $6,250 - BALTIC BRIEFING
Capesize
The Capesize market made new highs for the year this week after strong iron ore demand to the far east continued to develop in the mar ...
Friday, 12 June 20
CHINA CURBS COAL IMPORTS AFTER 5 MONTHS OF RECORD INFLOWS - SOURCES: REUTERS
China has stepped up customs checks for coal imports, leading to lengthy processing delays at ports, four sources familiar with the matter said, as ...
Friday, 12 June 20
COAL INDIA LIMITED SET FOR MARKETING DRIVE TO CREATE DEMAND - FINANCIAL EXPRESS
State-run miner Coal India (CIL), which is primarily focused on supplying coal to the power sector, is now reorienting its marketing to create dema ...
Friday, 12 June 20
MOODY'S REVISES BRENT OIL PRICE OUTLOOK TO $35/BARREL IN 2020 - TASS
Low oil prices are likely to exert the highest pressure on Iraq, Oman and Kuwait due to the limited space for the fiscal policy pursuit and higher ...
Thursday, 11 June 20
JAN-MAY, INDONESIA SHIPPED 175.15 MILLION TONS OF COAL TO ITS OVERSEAS BUYERS
Indonesia's coal production for the first 5 months of this year have reached 228 million tons. January – May 2020, Indonesia shipped US$ ...
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- Central Java Power - Indonesia
- European Bulk Services B.V. - Netherlands
- SMG Consultants - Indonesia
- Wood Mackenzie - Singapore
- PNOC Exploration Corporation - Philippines
- Karbindo Abesyapradhi - Indoneisa
- South Luzon Thermal Energy Corporation
- Orica Australia Pty. Ltd.
- IHS Mccloskey Coal Group - USA
- Siam City Cement - Thailand
- Banpu Public Company Limited - Thailand
- LBH Netherlands Bv - Netherlands
- Larsen & Toubro Limited - India
- Borneo Indobara - Indonesia
- Dalmia Cement Bharat India
- Asmin Koalindo Tuhup - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Global Coal Blending Company Limited - Australia
- Miang Besar Coal Terminal - Indonesia
- MS Steel International - UAE
- Xindia Steels Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Jindal Steel & Power Ltd - India
- TeaM Sual Corporation - Philippines
- Sojitz Corporation - Japan
- Leighton Contractors Pty Ltd - Australia
- Jaiprakash Power Ventures ltd
- Malabar Cements Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Grasim Industreis Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Aboitiz Power Corporation - Philippines
- Kepco SPC Power Corporation, Philippines
- Bharathi Cement Corporation - India
- Neyveli Lignite Corporation Ltd, - India
- Samtan Co., Ltd - South Korea
- Semirara Mining and Power Corporation, Philippines
- Rashtriya Ispat Nigam Limited - India
- Intertek Mineral Services - Indonesia
- SN Aboitiz Power Inc, Philippines
- Mercator Lines Limited - India
- Videocon Industries ltd - India
- Maheswari Brothers Coal Limited - India
- Ceylon Electricity Board - Sri Lanka
- Kapuas Tunggal Persada - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Indogreen Group - Indonesia
- VISA Power Limited - India
- Cement Manufacturers Association - India
- Global Green Power PLC Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Agrawal Coal Company - India
- SMC Global Power, Philippines
- Thai Mozambique Logistica
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Formosa Plastics Group - Taiwan
- Indika Energy - Indonesia
- Baramulti Group, Indonesia
- Alfred C Toepfer International GmbH - Germany
- Indian Energy Exchange, India
- Bukit Makmur.PT - Indonesia
- Ind-Barath Power Infra Limited - India
- GN Power Mariveles Coal Plant, Philippines
- McConnell Dowell - Australia
- Bhoruka Overseas - Indonesia
- Aditya Birla Group - India
- Metalloyd Limited - United Kingdom
- IEA Clean Coal Centre - UK
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- India Bulls Power Limited - India
- Cigading International Bulk Terminal - Indonesia
- Tata Chemicals Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Gujarat Sidhee Cement - India
- Kaltim Prima Coal - Indonesia
- Binh Thuan Hamico - Vietnam
- Kartika Selabumi Mining - Indonesia
- White Energy Company Limited
- Chettinad Cement Corporation Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Indian Oil Corporation Limited
- PTC India Limited - India
- Timah Investasi Mineral - Indoneisa
- London Commodity Brokers - England
- Thiess Contractors Indonesia
- Star Paper Mills Limited - India
- Straits Asia Resources Limited - Singapore
- Global Business Power Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Marubeni Corporation - India
- Chamber of Mines of South Africa
- Medco Energi Mining Internasional
- Bangladesh Power Developement Board
- Essar Steel Hazira Ltd - India
- Siam City Cement PLC, Thailand
- Wilmar Investment Holdings
- The University of Queensland
- Directorate General of MIneral and Coal - Indonesia
- Electricity Generating Authority of Thailand
- Pendopo Energi Batubara - Indonesia
- The Treasury - Australian Government
- Minerals Council of Australia
- Sinarmas Energy and Mining - Indonesia
- Trasteel International SA, Italy
- Kalimantan Lumbung Energi - Indonesia
- Deloitte Consulting - India
- Pipit Mutiara Jaya. PT, Indonesia
- CIMB Investment Bank - Malaysia
- The State Trading Corporation of India Ltd
- Bhatia International Limited - India
- Australian Coal Association
- Standard Chartered Bank - UAE
- Directorate Of Revenue Intelligence - India
- Economic Council, Georgia
- Barasentosa Lestari - Indonesia
- Savvy Resources Ltd - HongKong
- Uttam Galva Steels Limited - India
- Vedanta Resources Plc - India
- Romanian Commodities Exchange
- Vizag Seaport Private Limited - India
- Renaissance Capital - South Africa
- Merrill Lynch Commodities Europe
- Meenaskhi Energy Private Limited - India
- Manunggal Multi Energi - Indonesia
- GVK Power & Infra Limited - India
- Iligan Light & Power Inc, Philippines
- Planning Commission, India
- Coalindo Energy - Indonesia
- Bayan Resources Tbk. - Indonesia
- Energy Link Ltd, New Zealand
- ASAPP Information Group - India
- Sical Logistics Limited - India
- Energy Development Corp, Philippines
- Mercuria Energy - Indonesia
- Parry Sugars Refinery, India
- Petron Corporation, Philippines
- Petrochimia International Co. Ltd.- Taiwan
- Globalindo Alam Lestari - Indonesia
- Rio Tinto Coal - Australia
- Heidelberg Cement - Germany
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indonesian Coal Mining Association
- Ministry of Transport, Egypt
- Edison Trading Spa - Italy
- Bukit Baiduri Energy - Indonesia
- Posco Energy - South Korea
- Orica Mining Services - Indonesia
- Riau Bara Harum - Indonesia
- New Zealand Coal & Carbon
- Interocean Group of Companies - India
- GMR Energy Limited - India
- Meralco Power Generation, Philippines
- Coastal Gujarat Power Limited - India
- Ministry of Finance - Indonesia
- Eastern Coal Council - USA
- OPG Power Generation Pvt Ltd - India
- Mintek Dendrill Indonesia
- Therma Luzon, Inc, Philippines
- ICICI Bank Limited - India
- Australian Commodity Traders Exchange
- Tamil Nadu electricity Board
- Ambuja Cements Ltd - India
- Lanco Infratech Ltd - India
- Sree Jayajothi Cements Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Toyota Tsusho Corporation, Japan
- Eastern Energy - Thailand
- Goldman Sachs - Singapore
- Attock Cement Pakistan Limited
- CNBM International Corporation - China
- Kobexindo Tractors - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Central Electricity Authority - India
- Holcim Trading Pte Ltd - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Madhucon Powers Ltd - India
- Kumho Petrochemical, South Korea
- Electricity Authority, New Zealand
- Sarangani Energy Corporation, Philippines
- Independent Power Producers Association of India
- Kideco Jaya Agung - Indonesia
- International Coal Ventures Pvt Ltd - India
- Latin American Coal - Colombia
- Sindya Power Generating Company Private Ltd
- Africa Commodities Group - South Africa
- Oldendorff Carriers - Singapore
- Salva Resources Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Antam Resourcindo - Indonesia
- Semirara Mining Corp, Philippines
- AsiaOL BioFuels Corp., Philippines
- Coal and Oil Company - UAE
- Bhushan Steel Limited - India
- Port Waratah Coal Services - Australia
- Mjunction Services Limited - India
- Altura Mining Limited, Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Anglo American - United Kingdom
- Parliament of New Zealand
- Carbofer General Trading SA - India
- San Jose City I Power Corp, Philippines
- Karaikal Port Pvt Ltd - India
- PowerSource Philippines DevCo
- GAC Shipping (India) Pvt Ltd
- Indo Tambangraya Megah - Indonesia
- Makarim & Taira - Indonesia
- Georgia Ports Authority, United States
- Ministry of Mines - Canada
- Singapore Mercantile Exchange
- Billiton Holdings Pty Ltd - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sakthi Sugars Limited - India
- Commonwealth Bank - Australia
- Simpson Spence & Young - Indonesia
- Power Finance Corporation Ltd., India
- Bulk Trading Sa - Switzerland
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