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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, 25 August 20
INDIA'S IMPORTS FALL AS LOCKDOWNS IMPACT THE POWER AND INDUSTRIAL SECTORS - REPORT
India is the world’s second largest thermal coal consumer and importer, importing an estimated 211 million tonnes of thermal coal in 2019.&nb ...
Monday, 24 August 20
A COMBINATION OF DEVELOPMENTS DROVE THE FALLOFF COAL PRICES - CHIEF ECONOMIST’ OFFICE, AUSTRALIA
China, rising domestic production combined with subdued power demand;
India, a lockdown coupled with government directives that fav ...
Monday, 24 August 20
AUSTRALIA'S THERMAL COAL EXPORTS ARE FORECAST TO DROP FROM AN ESTIMATED $20 BILLION IN 2019-20 TO $16 BILLION IN 2020-21: REPORT
Thermal coal spot prices have fallen sharply as the impact of COVID-19 drives a contraction in seaborne trade for only the second time this century ...
Saturday, 22 August 20
REPORT SEES INDIA’S RELIANCE ON THERMAL POWER DROPPING TO 50% IN 2021, 43% IN 2026 - ET ENERGY | IEEFA
India’s dependence on thermal power will reduce to 50 per cent by 2021-22 and 43 per cent by 2026-27 on the back of renewable energy (RE) cap ...
Friday, 21 August 20
323 MILLION ELECTRIC VEHICLES WILL BE ON THE ROADS BY 2040 - WOOD MACKENZIE
Electric vehicle (EV) sales are expected to reach 45 million units per year by 2040, with a total global EV stock of 323 million, according to new ...
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- Directorate Of Revenue Intelligence - India
- Pipit Mutiara Jaya. PT, Indonesia
- Aboitiz Power Corporation - Philippines
- Billiton Holdings Pty Ltd - Australia
- Kumho Petrochemical, South Korea
- Central Electricity Authority - India
- Romanian Commodities Exchange
- Xindia Steels Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Africa Commodities Group - South Africa
- Mercuria Energy - Indonesia
- Anglo American - United Kingdom
- Bukit Asam (Persero) Tbk - Indonesia
- Toyota Tsusho Corporation, Japan
- Sojitz Corporation - Japan
- New Zealand Coal & Carbon
- White Energy Company Limited
- Gujarat Sidhee Cement - India
- Bayan Resources Tbk. - Indonesia
- European Bulk Services B.V. - Netherlands
- Pendopo Energi Batubara - Indonesia
- Mercator Lines Limited - India
- AsiaOL BioFuels Corp., Philippines
- Energy Link Ltd, New Zealand
- Maheswari Brothers Coal Limited - India
- San Jose City I Power Corp, Philippines
- GMR Energy Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Banpu Public Company Limited - Thailand
- Planning Commission, India
- Ministry of Finance - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Chamber of Mines of South Africa
- Vijayanagar Sugar Pvt Ltd - India
- PTC India Limited - India
- Mintek Dendrill Indonesia
- Port Waratah Coal Services - Australia
- Savvy Resources Ltd - HongKong
- Dalmia Cement Bharat India
- IHS Mccloskey Coal Group - USA
- Simpson Spence & Young - Indonesia
- Medco Energi Mining Internasional
- McConnell Dowell - Australia
- Coalindo Energy - Indonesia
- VISA Power Limited - India
- India Bulls Power Limited - India
- GAC Shipping (India) Pvt Ltd
- Antam Resourcindo - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bhoruka Overseas - Indonesia
- Makarim & Taira - Indonesia
- IEA Clean Coal Centre - UK
- Sree Jayajothi Cements Limited - India
- Electricity Generating Authority of Thailand
- Intertek Mineral Services - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Larsen & Toubro Limited - India
- Bulk Trading Sa - Switzerland
- Kideco Jaya Agung - Indonesia
- Vedanta Resources Plc - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Binh Thuan Hamico - Vietnam
- Bharathi Cement Corporation - India
- Deloitte Consulting - India
- Krishnapatnam Port Company Ltd. - India
- Eastern Coal Council - USA
- Global Green Power PLC Corporation, Philippines
- Bangladesh Power Developement Board
- The State Trading Corporation of India Ltd
- Miang Besar Coal Terminal - Indonesia
- Indian Energy Exchange, India
- Bahari Cakrawala Sebuku - Indonesia
- PowerSource Philippines DevCo
- Sical Logistics Limited - India
- Bhushan Steel Limited - India
- Carbofer General Trading SA - India
- Chettinad Cement Corporation Ltd - India
- Trasteel International SA, Italy
- Orica Australia Pty. Ltd.
- Power Finance Corporation Ltd., India
- Orica Mining Services - Indonesia
- The University of Queensland
- Parry Sugars Refinery, India
- SMC Global Power, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Kobexindo Tractors - Indoneisa
- Mjunction Services Limited - India
- Wood Mackenzie - Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Therma Luzon, Inc, Philippines
- Georgia Ports Authority, United States
- The Treasury - Australian Government
- Borneo Indobara - Indonesia
- Ministry of Transport, Egypt
- Ceylon Electricity Board - Sri Lanka
- Attock Cement Pakistan Limited
- ASAPP Information Group - India
- CIMB Investment Bank - Malaysia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Metalloyd Limited - United Kingdom
- Star Paper Mills Limited - India
- Rio Tinto Coal - Australia
- South Luzon Thermal Energy Corporation
- Singapore Mercantile Exchange
- SN Aboitiz Power Inc, Philippines
- Siam City Cement - Thailand
- Marubeni Corporation - India
- Minerals Council of Australia
- Posco Energy - South Korea
- Standard Chartered Bank - UAE
- Australian Commodity Traders Exchange
- Price Waterhouse Coopers - Russia
- Uttam Galva Steels Limited - India
- Lanco Infratech Ltd - India
- Petron Corporation, Philippines
- Global Coal Blending Company Limited - Australia
- Coal and Oil Company - UAE
- Kaltim Prima Coal - Indonesia
- Commonwealth Bank - Australia
- Indian Oil Corporation Limited
- Edison Trading Spa - Italy
- Siam City Cement PLC, Thailand
- Sindya Power Generating Company Private Ltd
- Globalindo Alam Lestari - Indonesia
- Parliament of New Zealand
- Bhatia International Limited - India
- GVK Power & Infra Limited - India
- CNBM International Corporation - China
- Timah Investasi Mineral - Indoneisa
- Neyveli Lignite Corporation Ltd, - India
- MS Steel International - UAE
- Sinarmas Energy and Mining - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Semirara Mining Corp, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Grasim Industreis Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Kartika Selabumi Mining - Indonesia
- Vizag Seaport Private Limited - India
- Wilmar Investment Holdings
- Oldendorff Carriers - Singapore
- Renaissance Capital - South Africa
- Maharashtra Electricity Regulatory Commission - India
- Bukit Baiduri Energy - Indonesia
- Global Business Power Corporation, Philippines
- Indika Energy - Indonesia
- Coastal Gujarat Power Limited - India
- Barasentosa Lestari - Indonesia
- Riau Bara Harum - Indonesia
- International Coal Ventures Pvt Ltd - India
- Cigading International Bulk Terminal - Indonesia
- Madhucon Powers Ltd - India
- LBH Netherlands Bv - Netherlands
- Indo Tambangraya Megah - Indonesia
- Eastern Energy - Thailand
- Meralco Power Generation, Philippines
- Kepco SPC Power Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Meenaskhi Energy Private Limited - India
- Electricity Authority, New Zealand
- Sarangani Energy Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Heidelberg Cement - Germany
- London Commodity Brokers - England
- Essar Steel Hazira Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Leighton Contractors Pty Ltd - Australia
- Australian Coal Association
- Semirara Mining and Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- Independent Power Producers Association of India
- Agrawal Coal Company - India
- Directorate General of MIneral and Coal - Indonesia
- Samtan Co., Ltd - South Korea
- Tata Chemicals Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Videocon Industries ltd - India
- Aditya Birla Group - India
- Jaiprakash Power Ventures ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Economic Council, Georgia
- Ambuja Cements Ltd - India
- Energy Development Corp, Philippines
- ICICI Bank Limited - India
- Alfred C Toepfer International GmbH - Germany
- Goldman Sachs - Singapore
- Jorong Barutama Greston.PT - Indonesia
- Thai Mozambique Logistica
- Iligan Light & Power Inc, Philippines
- Cement Manufacturers Association - India
- Indogreen Group - Indonesia
- Central Java Power - Indonesia
- Tamil Nadu electricity Board
- Bukit Makmur.PT - Indonesia
- OPG Power Generation Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Malabar Cements Ltd - India
- Merrill Lynch Commodities Europe
- Formosa Plastics Group - Taiwan
- Straits Asia Resources Limited - Singapore
- Altura Mining Limited, Indonesia
- Sakthi Sugars Limited - India
- Ministry of Mines - Canada
- Jindal Steel & Power Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Latin American Coal - Colombia
- SMG Consultants - Indonesia
- Interocean Group of Companies - India
- TeaM Sual Corporation - Philippines
- Thiess Contractors Indonesia
- Baramulti Group, Indonesia
- Indonesian Coal Mining Association
- Ind-Barath Power Infra Limited - India
- Kohat Cement Company Ltd. - Pakistan
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