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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, 02 June 20
THE HISTORIC DECLINE OF US COAL - WOOD MACKENZIE
The first commercial power plant in the US was Thomas Edison’s coal-fired Pearl Street station in lower Manhattan, which started operating in ...
Tuesday, 02 June 20
COAL INDIA'S MAY SALES DRIVEN SHARPLY LOWER BY SLUMP IN POWER DEMAND - REUTER
Coal India’s sales fell 23.3% in May as utilities refrained from purchases amid record stockpiles and tepid demand because of a nationwide lo ...
Tuesday, 02 June 20
TUAH TURANGGA AGUNG RECORDED 4.54 MILLION TONS OF COAL SALES IN THE FIRST FOUR MONTHS OF 2020
PT United Tractors Tbk through its subsidiary, PT Tuah Turangga Agung recorded 4.54 million tons of coal sales in the first four months of 2020, up ...
Tuesday, 02 June 20
SOURING SINO-AUSTRALIA TRADE RELATIONS - BALTIC EXCHANGE
Cooling relations between the commodity powerhouses of China and Australia may point to trade troubles ahead when the world emerges from the Covid- ...
Tuesday, 02 June 20
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX DOWN 0.86 PCT - XINHUA
China Taiyuan coal transaction price index stood at 123.95 points Monday, down 0.86 percent week on week.
The index, released by Chi ...
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- Altura Mining Limited, Indonesia
- Minerals Council of Australia
- Parry Sugars Refinery, India
- Kohat Cement Company Ltd. - Pakistan
- Sinarmas Energy and Mining - Indonesia
- Sakthi Sugars Limited - India
- Leighton Contractors Pty Ltd - Australia
- Kideco Jaya Agung - Indonesia
- Borneo Indobara - Indonesia
- Deloitte Consulting - India
- Simpson Spence & Young - Indonesia
- Bhushan Steel Limited - India
- Banpu Public Company Limited - Thailand
- Vedanta Resources Plc - India
- Singapore Mercantile Exchange
- Bharathi Cement Corporation - India
- Grasim Industreis Ltd - India
- McConnell Dowell - Australia
- Alfred C Toepfer International GmbH - Germany
- Karaikal Port Pvt Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Siam City Cement - Thailand
- Central Java Power - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Planning Commission, India
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- Wood Mackenzie - Singapore
- The State Trading Corporation of India Ltd
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- Binh Thuan Hamico - Vietnam
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- Latin American Coal - Colombia
- Bayan Resources Tbk. - Indonesia
- Parliament of New Zealand
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- Energy Development Corp, Philippines
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- Metalloyd Limited - United Kingdom
- Kepco SPC Power Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Jindal Steel & Power Ltd - India
- PowerSource Philippines DevCo
- London Commodity Brokers - England
- Georgia Ports Authority, United States
- Africa Commodities Group - South Africa
- Asmin Koalindo Tuhup - Indonesia
- Timah Investasi Mineral - Indoneisa
- Indian Oil Corporation Limited
- ICICI Bank Limited - India
- Rio Tinto Coal - Australia
- GVK Power & Infra Limited - India
- GMR Energy Limited - India
- Kaltim Prima Coal - Indonesia
- Toyota Tsusho Corporation, Japan
- Sical Logistics Limited - India
- TeaM Sual Corporation - Philippines
- Mercator Lines Limited - India
- Commonwealth Bank - Australia
- Mintek Dendrill Indonesia
- AsiaOL BioFuels Corp., Philippines
- Jaiprakash Power Ventures ltd
- Aboitiz Power Corporation - Philippines
- Standard Chartered Bank - UAE
- Xindia Steels Limited - India
- Bhatia International Limited - India
- Ministry of Finance - Indonesia
- Sree Jayajothi Cements Limited - India
- Independent Power Producers Association of India
- PTC India Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Agrawal Coal Company - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Bukit Asam (Persero) Tbk - Indonesia
- Antam Resourcindo - Indonesia
- Central Electricity Authority - India
- Rashtriya Ispat Nigam Limited - India
- European Bulk Services B.V. - Netherlands
- Samtan Co., Ltd - South Korea
- Kalimantan Lumbung Energi - Indonesia
- Indian Energy Exchange, India
- Oldendorff Carriers - Singapore
- Kobexindo Tractors - Indoneisa
- OPG Power Generation Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- Indika Energy - Indonesia
- Bulk Trading Sa - Switzerland
- SN Aboitiz Power Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- SMG Consultants - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Eastern Energy - Thailand
- Uttam Galva Steels Limited - India
- Sindya Power Generating Company Private Ltd
- New Zealand Coal & Carbon
- ASAPP Information Group - India
- Semirara Mining Corp, Philippines
- Bukit Makmur.PT - Indonesia
- Dalmia Cement Bharat India
- Maheswari Brothers Coal Limited - India
- Energy Link Ltd, New Zealand
- Cigading International Bulk Terminal - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Australian Coal Association
- CIMB Investment Bank - Malaysia
- Bukit Baiduri Energy - Indonesia
- IEA Clean Coal Centre - UK
- Romanian Commodities Exchange
- Kumho Petrochemical, South Korea
- Indo Tambangraya Megah - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Pipit Mutiara Jaya. PT, Indonesia
- Malabar Cements Ltd - India
- Intertek Mineral Services - Indonesia
- Wilmar Investment Holdings
- Carbofer General Trading SA - India
- Formosa Plastics Group - Taiwan
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Renaissance Capital - South Africa
- Tamil Nadu electricity Board
- Siam City Cement PLC, Thailand
- Therma Luzon, Inc, Philippines
- Gujarat Sidhee Cement - India
- Bangladesh Power Developement Board
- Price Waterhouse Coopers - Russia
- Coal and Oil Company - UAE
- Baramulti Group, Indonesia
- Cement Manufacturers Association - India
- Aditya Birla Group - India
- Chettinad Cement Corporation Ltd - India
- GAC Shipping (India) Pvt Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Posco Energy - South Korea
- Tata Chemicals Ltd - India
- Pendopo Energi Batubara - Indonesia
- Salva Resources Pvt Ltd - India
- The Treasury - Australian Government
- LBH Netherlands Bv - Netherlands
- Coastal Gujarat Power Limited - India
- Meenaskhi Energy Private Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Edison Trading Spa - Italy
- Lanco Infratech Ltd - India
- Mjunction Services Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Electricity Authority, New Zealand
- IHS Mccloskey Coal Group - USA
- International Coal Ventures Pvt Ltd - India
- Heidelberg Cement - Germany
- MS Steel International - UAE
- Indogreen Group - Indonesia
- Global Coal Blending Company Limited - Australia
- Goldman Sachs - Singapore
- Attock Cement Pakistan Limited
- The University of Queensland
- SMC Global Power, Philippines
- Directorate Of Revenue Intelligence - India
- Madhucon Powers Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Larsen & Toubro Limited - India
- CNBM International Corporation - China
- Iligan Light & Power Inc, Philippines
- Economic Council, Georgia
- Sarangani Energy Corporation, Philippines
- Power Finance Corporation Ltd., India
- Star Paper Mills Limited - India
- Essar Steel Hazira Ltd - India
- India Bulls Power Limited - India
- Ministry of Mines - Canada
- Coalindo Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Eastern Coal Council - USA
- Orica Australia Pty. Ltd.
- Anglo American - United Kingdom
- Petron Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Chamber of Mines of South Africa
- Medco Energi Mining Internasional
- Manunggal Multi Energi - Indonesia
- Global Business Power Corporation, Philippines
- Electricity Generating Authority of Thailand
- Karbindo Abesyapradhi - Indoneisa
- VISA Power Limited - India
- Merrill Lynch Commodities Europe
- Interocean Group of Companies - India
- Ministry of Transport, Egypt
- Bank of Tokyo Mitsubishi UFJ Ltd
- Australian Commodity Traders Exchange
- Barasentosa Lestari - Indonesia
- Ceylon Electricity Board - Sri Lanka
- White Energy Company Limited
- South Luzon Thermal Energy Corporation
- Petrochimia International Co. Ltd.- Taiwan
- Marubeni Corporation - India
- Sojitz Corporation - Japan
- Billiton Holdings Pty Ltd - Australia
- Krishnapatnam Port Company Ltd. - India
- Trasteel International SA, Italy
- Thai Mozambique Logistica
- Mercuria Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- Thiess Contractors Indonesia
- Straits Asia Resources Limited - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Ind-Barath Power Infra Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Ambuja Cements Ltd - India
- Riau Bara Harum - Indonesia
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- Videocon Industries ltd - India
- Meralco Power Generation, Philippines
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