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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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Monday, 25 May 20
NON-OPEC OIL SUPPLY DEVELOPMENT - OPEC
Non-OPEC oil supply continued to increase by 2.0 mb/d in 2019, driven by US shale production, which rose by 1.7 mb/d, amounting to 84% of total non ...
Sunday, 24 May 20
A 63,000 FIXED DELIVERY VIETNAM TRIP VIA INDONESIA REDELIVERY KOSICHANG AT $8,500 - BALTIC BRIEFING
Capesize
After a week of bounce momentum the market appears to have stalled out once again. The Capesize 5TC has more than doubled since last F ...
Saturday, 23 May 20
COLOMBIA COAL OUTPUT DOWN 7.2% IN Q1 ON LOW PRICES, CORONAVIRUS LOCKDOWN - REUTERS
Coal production in Colombia, the world’s fifth-largest coal exporter, fell 7.2% in the first quarter because of low prices and coronavirus qu ...
Saturday, 23 May 20
EWP INVITES BIDS FOR 840,000 METRIC TONS OF MIN 5700 NAR COAL
COALspot.com: South Korea’s Korea East-West Power Co. Ltd (EWP) has Issued an International Tender for total Max 840,000 Metric Tons of min 5 ...
Thursday, 21 May 20
KOMIPO INVITED BIDS FOR TOTAL 610000 MT OF LCV AND HCV COAL FOR 2H 2020
COALspot.com: South Korea’s Korea Midland Power Co. Ltd. (KOMIPO) has Issued an International Tender for 130,000 mt of 5700 NCV coal an ...
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- GVK Power & Infra Limited - India
- Tata Chemicals Ltd - India
- Planning Commission, India
- White Energy Company Limited
- Kepco SPC Power Corporation, Philippines
- Malabar Cements Ltd - India
- Bukit Makmur.PT - Indonesia
- Ind-Barath Power Infra Limited - India
- Riau Bara Harum - Indonesia
- Binh Thuan Hamico - Vietnam
- Coal and Oil Company - UAE
- Siam City Cement - Thailand
- Aboitiz Power Corporation - Philippines
- CNBM International Corporation - China
- Coastal Gujarat Power Limited - India
- Marubeni Corporation - India
- Kobexindo Tractors - Indoneisa
- London Commodity Brokers - England
- Krishnapatnam Port Company Ltd. - India
- Wilmar Investment Holdings
- Sical Logistics Limited - India
- Sindya Power Generating Company Private Ltd
- Ministry of Mines - Canada
- Semirara Mining and Power Corporation, Philippines
- PowerSource Philippines DevCo
- Alfred C Toepfer International GmbH - Germany
- Economic Council, Georgia
- Altura Mining Limited, Indonesia
- Meenaskhi Energy Private Limited - India
- New Zealand Coal & Carbon
- Globalindo Alam Lestari - Indonesia
- Savvy Resources Ltd - HongKong
- SN Aboitiz Power Inc, Philippines
- Baramulti Group, Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Vizag Seaport Private Limited - India
- The University of Queensland
- Edison Trading Spa - Italy
- PNOC Exploration Corporation - Philippines
- Jaiprakash Power Ventures ltd
- Barasentosa Lestari - Indonesia
- Agrawal Coal Company - India
- Oldendorff Carriers - Singapore
- Anglo American - United Kingdom
- Banpu Public Company Limited - Thailand
- Kohat Cement Company Ltd. - Pakistan
- Simpson Spence & Young - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Cement Manufacturers Association - India
- Manunggal Multi Energi - Indonesia
- European Bulk Services B.V. - Netherlands
- Toyota Tsusho Corporation, Japan
- Videocon Industries ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sojitz Corporation - Japan
- Port Waratah Coal Services - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- IEA Clean Coal Centre - UK
- Indogreen Group - Indonesia
- Sree Jayajothi Cements Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Trasteel International SA, Italy
- Merrill Lynch Commodities Europe
- Coalindo Energy - Indonesia
- Makarim & Taira - Indonesia
- Deloitte Consulting - India
- Electricity Generating Authority of Thailand
- Straits Asia Resources Limited - Singapore
- Carbofer General Trading SA - India
- Central Java Power - Indonesia
- Rio Tinto Coal - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bukit Baiduri Energy - Indonesia
- The Treasury - Australian Government
- Bangladesh Power Developement Board
- Power Finance Corporation Ltd., India
- India Bulls Power Limited - India
- Bayan Resources Tbk. - Indonesia
- Ministry of Transport, Egypt
- The State Trading Corporation of India Ltd
- Salva Resources Pvt Ltd - India
- Australian Coal Association
- Larsen & Toubro Limited - India
- Therma Luzon, Inc, Philippines
- SMC Global Power, Philippines
- Parry Sugars Refinery, India
- Kartika Selabumi Mining - Indonesia
- Vedanta Resources Plc - India
- Petron Corporation, Philippines
- Ministry of Finance - Indonesia
- OPG Power Generation Pvt Ltd - India
- Independent Power Producers Association of India
- MS Steel International - UAE
- Gujarat Mineral Development Corp Ltd - India
- Medco Energi Mining Internasional
- Interocean Group of Companies - India
- Attock Cement Pakistan Limited
- Holcim Trading Pte Ltd - Singapore
- Global Coal Blending Company Limited - Australia
- Ceylon Electricity Board - Sri Lanka
- Bhatia International Limited - India
- Sakthi Sugars Limited - India
- San Jose City I Power Corp, Philippines
- Kumho Petrochemical, South Korea
- Directorate Of Revenue Intelligence - India
- Semirara Mining Corp, Philippines
- Global Green Power PLC Corporation, Philippines
- Grasim Industreis Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Orica Australia Pty. Ltd.
- Mintek Dendrill Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Miang Besar Coal Terminal - Indonesia
- Commonwealth Bank - Australia
- Formosa Plastics Group - Taiwan
- AsiaOL BioFuels Corp., Philippines
- Energy Link Ltd, New Zealand
- Pipit Mutiara Jaya. PT, Indonesia
- Aditya Birla Group - India
- Thiess Contractors Indonesia
- Central Electricity Authority - India
- GAC Shipping (India) Pvt Ltd
- Chamber of Mines of South Africa
- Electricity Authority, New Zealand
- Parliament of New Zealand
- Cigading International Bulk Terminal - Indonesia
- Timah Investasi Mineral - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- Thai Mozambique Logistica
- Antam Resourcindo - Indonesia
- Australian Commodity Traders Exchange
- Leighton Contractors Pty Ltd - Australia
- Gujarat Electricity Regulatory Commission - India
- Bahari Cakrawala Sebuku - Indonesia
- Romanian Commodities Exchange
- South Luzon Thermal Energy Corporation
- Indonesian Coal Mining Association
- Meralco Power Generation, Philippines
- Kaltim Prima Coal - Indonesia
- Orica Mining Services - Indonesia
- Georgia Ports Authority, United States
- Chettinad Cement Corporation Ltd - India
- Essar Steel Hazira Ltd - India
- Renaissance Capital - South Africa
- Neyveli Lignite Corporation Ltd, - India
- Mercuria Energy - Indonesia
- Mjunction Services Limited - India
- Bulk Trading Sa - Switzerland
- Ambuja Cements Ltd - India
- Minerals Council of Australia
- Sinarmas Energy and Mining - Indonesia
- Karaikal Port Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Kapuas Tunggal Persada - Indonesia
- McConnell Dowell - Australia
- Tamil Nadu electricity Board
- International Coal Ventures Pvt Ltd - India
- Price Waterhouse Coopers - Russia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Latin American Coal - Colombia
- Eastern Energy - Thailand
- Metalloyd Limited - United Kingdom
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Africa Commodities Group - South Africa
- Indian Energy Exchange, India
- TeaM Sual Corporation - Philippines
- Jindal Steel & Power Ltd - India
- SMG Consultants - Indonesia
- GMR Energy Limited - India
- Dalmia Cement Bharat India
- Kalimantan Lumbung Energi - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Borneo Indobara - Indonesia
- Samtan Co., Ltd - South Korea
- Wood Mackenzie - Singapore
- Bharathi Cement Corporation - India
- Vijayanagar Sugar Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Star Paper Mills Limited - India
- Siam City Cement PLC, Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Madhucon Powers Ltd - India
- Indika Energy - Indonesia
- Maheswari Brothers Coal Limited - India
- Intertek Mineral Services - Indonesia
- Energy Development Corp, Philippines
- PTC India Limited - India
- Eastern Coal Council - USA
- Global Business Power Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Heidelberg Cement - Germany
- Bhoruka Overseas - Indonesia
- CIMB Investment Bank - Malaysia
- Xindia Steels Limited - India
- Posco Energy - South Korea
- Iligan Light & Power Inc, Philippines
- ASAPP Information Group - India
- Standard Chartered Bank - UAE
- Maharashtra Electricity Regulatory Commission - India
- Uttam Galva Steels Limited - India
- Indo Tambangraya Megah - Indonesia
- LBH Netherlands Bv - Netherlands
- IHS Mccloskey Coal Group - USA
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Singapore Mercantile Exchange
- Indian Oil Corporation Limited
- ICICI Bank Limited - India
- Goldman Sachs - Singapore
- VISA Power Limited - India
- Sarangani Energy Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Lanco Infratech Ltd - India
- Mercator Lines Limited - India
- Pendopo Energi Batubara - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Bhushan Steel Limited - India
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