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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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Friday, 19 June 20
INDIA'S COAL CONSUMPTION GROWTH IN 2019 SLOWEST SINCE 2001: BP STATS REVIEW - HINDU BUSINESS LINE
Growth in global energy markets slowed in 2019 in line with weaker economic growth, according to the bp Statistical Review of World Energy 2020. Th ...
Friday, 19 June 20
KOWEPO TO IMPORT 1,050,000 MT OF MIN 5300 NCV COAL FOR THREE YEARS
COALspot.com: Korera Western Power Co., Ltd. (KOWEPO) has issued an International tender for Total 1,050k MT Min.5,300 kcal/kg NCV coal for t ...
Thursday, 18 June 20
INDIA: GOVT'S PLAN TO CUT COAL IMPORT GOES FOR A TOSS AS FY20 BREAKS LOGISTICS CHAIN; LOCAL OUTPUT STAGNANT - FINANCIAL EXPRESS
Weak logistics support and disrupted supply chain towards the end of the last financial year 2019-20 hit the government’s plan to cut coal im ...
Thursday, 18 June 20
INDIA: THERMAL PLANTS TO OPERATE BELOW 53% CAPACITY IN FY21 AS POWER DEMAND DIPS - BUSINESS STANDARD
The Plant Load Factor (PLF) of thermal power stations across the country is projected to dip below 53 per cent in this fiscal. Muted power demand f ...
Wednesday, 17 June 20
MARKET INSIGHT - INTERMODAL
After experiencing record earnings during the first half of the year, the focus of headlines concerning the tanker market has shifted from the deve ...
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- Bangladesh Power Developement Board
- Neyveli Lignite Corporation Ltd, - India
- Essar Steel Hazira Ltd - India
- Xindia Steels Limited - India
- The University of Queensland
- Holcim Trading Pte Ltd - Singapore
- Kepco SPC Power Corporation, Philippines
- Coalindo Energy - Indonesia
- Vedanta Resources Plc - India
- Meralco Power Generation, Philippines
- Toyota Tsusho Corporation, Japan
- Metalloyd Limited - United Kingdom
- GN Power Mariveles Coal Plant, Philippines
- Sojitz Corporation - Japan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Africa Commodities Group - South Africa
- SMG Consultants - Indonesia
- Romanian Commodities Exchange
- Gujarat Electricity Regulatory Commission - India
- Standard Chartered Bank - UAE
- Bahari Cakrawala Sebuku - Indonesia
- Madhucon Powers Ltd - India
- Binh Thuan Hamico - Vietnam
- Pipit Mutiara Jaya. PT, Indonesia
- San Jose City I Power Corp, Philippines
- Salva Resources Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Semirara Mining and Power Corporation, Philippines
- Mintek Dendrill Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Sakthi Sugars Limited - India
- Jaiprakash Power Ventures ltd
- Sindya Power Generating Company Private Ltd
- Siam City Cement PLC, Thailand
- CIMB Investment Bank - Malaysia
- VISA Power Limited - India
- Ceylon Electricity Board - Sri Lanka
- South Luzon Thermal Energy Corporation
- Straits Asia Resources Limited - Singapore
- Marubeni Corporation - India
- Bulk Trading Sa - Switzerland
- Posco Energy - South Korea
- Borneo Indobara - Indonesia
- Australian Commodity Traders Exchange
- Vizag Seaport Private Limited - India
- Medco Energi Mining Internasional
- Tata Chemicals Ltd - India
- India Bulls Power Limited - India
- Sical Logistics Limited - India
- Videocon Industries ltd - India
- Kaltim Prima Coal - Indonesia
- Riau Bara Harum - Indonesia
- Deloitte Consulting - India
- Mercator Lines Limited - India
- GVK Power & Infra Limited - India
- Electricity Authority, New Zealand
- Star Paper Mills Limited - India
- GMR Energy Limited - India
- Leighton Contractors Pty Ltd - Australia
- Anglo American - United Kingdom
- Grasim Industreis Ltd - India
- Uttam Galva Steels Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Agrawal Coal Company - India
- Heidelberg Cement - Germany
- Chamber of Mines of South Africa
- Commonwealth Bank - Australia
- Edison Trading Spa - Italy
- Iligan Light & Power Inc, Philippines
- Aditya Birla Group - India
- Bharathi Cement Corporation - India
- Attock Cement Pakistan Limited
- PowerSource Philippines DevCo
- Indogreen Group - Indonesia
- Ambuja Cements Ltd - India
- Altura Mining Limited, Indonesia
- Coastal Gujarat Power Limited - India
- London Commodity Brokers - England
- Indika Energy - Indonesia
- Indo Tambangraya Megah - Indonesia
- Global Business Power Corporation, Philippines
- Thiess Contractors Indonesia
- Maheswari Brothers Coal Limited - India
- Eastern Energy - Thailand
- Kohat Cement Company Ltd. - Pakistan
- Kartika Selabumi Mining - Indonesia
- McConnell Dowell - Australia
- Directorate Of Revenue Intelligence - India
- Globalindo Alam Lestari - Indonesia
- Oldendorff Carriers - Singapore
- Cigading International Bulk Terminal - Indonesia
- Aboitiz Power Corporation - Philippines
- Thai Mozambique Logistica
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bank of Tokyo Mitsubishi UFJ Ltd
- Tamil Nadu electricity Board
- Power Finance Corporation Ltd., India
- Orica Australia Pty. Ltd.
- Kalimantan Lumbung Energi - Indonesia
- Savvy Resources Ltd - HongKong
- Siam City Cement - Thailand
- Central Electricity Authority - India
- Planning Commission, India
- Asmin Koalindo Tuhup - Indonesia
- Mjunction Services Limited - India
- Malabar Cements Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Merrill Lynch Commodities Europe
- Krishnapatnam Port Company Ltd. - India
- CNBM International Corporation - China
- Energy Development Corp, Philippines
- Ministry of Transport, Egypt
- OPG Power Generation Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Central Java Power - Indonesia
- Ministry of Mines - Canada
- Australian Coal Association
- Manunggal Multi Energi - Indonesia
- Antam Resourcindo - Indonesia
- Barasentosa Lestari - Indonesia
- Kumho Petrochemical, South Korea
- Wilmar Investment Holdings
- Rashtriya Ispat Nigam Limited - India
- Bhoruka Overseas - Indonesia
- Eastern Coal Council - USA
- PNOC Exploration Corporation - Philippines
- Formosa Plastics Group - Taiwan
- Therma Luzon, Inc, Philippines
- Ministry of Finance - Indonesia
- SN Aboitiz Power Inc, Philippines
- Electricity Generating Authority of Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Samtan Co., Ltd - South Korea
- Indian Oil Corporation Limited
- Carbofer General Trading SA - India
- Parry Sugars Refinery, India
- Lanco Infratech Ltd - India
- Karaikal Port Pvt Ltd - India
- Mercuria Energy - Indonesia
- Gujarat Sidhee Cement - India
- Karbindo Abesyapradhi - Indoneisa
- Billiton Holdings Pty Ltd - Australia
- Minerals Council of Australia
- Bayan Resources Tbk. - Indonesia
- LBH Netherlands Bv - Netherlands
- Chettinad Cement Corporation Ltd - India
- Independent Power Producers Association of India
- Jindal Steel & Power Ltd - India
- Meenaskhi Energy Private Limited - India
- Trasteel International SA, Italy
- Cement Manufacturers Association - India
- Goldman Sachs - Singapore
- Indian Energy Exchange, India
- Larsen & Toubro Limited - India
- Bhatia International Limited - India
- IEA Clean Coal Centre - UK
- AsiaOL BioFuels Corp., Philippines
- Miang Besar Coal Terminal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Kideco Jaya Agung - Indonesia
- Orica Mining Services - Indonesia
- Ind-Barath Power Infra Limited - India
- PTC India Limited - India
- The State Trading Corporation of India Ltd
- ICICI Bank Limited - India
- Makarim & Taira - Indonesia
- Sree Jayajothi Cements Limited - India
- Rio Tinto Coal - Australia
- Simpson Spence & Young - Indonesia
- International Coal Ventures Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Banpu Public Company Limited - Thailand
- Offshore Bulk Terminal Pte Ltd, Singapore
- GAC Shipping (India) Pvt Ltd
- Sarangani Energy Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- TeaM Sual Corporation - Philippines
- Global Green Power PLC Corporation, Philippines
- Georgia Ports Authority, United States
- Alfred C Toepfer International GmbH - Germany
- Economic Council, Georgia
- Energy Link Ltd, New Zealand
- The Treasury - Australian Government
- Indonesian Coal Mining Association
- Singapore Mercantile Exchange
- Bukit Baiduri Energy - Indonesia
- Semirara Mining Corp, Philippines
- SMC Global Power, Philippines
- Wood Mackenzie - Singapore
- Timah Investasi Mineral - Indoneisa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- IHS Mccloskey Coal Group - USA
- Intertek Mineral Services - Indonesia
- Parliament of New Zealand
- Global Coal Blending Company Limited - Australia
- Dalmia Cement Bharat India
- New Zealand Coal & Carbon
- Baramulti Group, Indonesia
- Renaissance Capital - South Africa
- Latin American Coal - Colombia
- Bhushan Steel Limited - India
- ASAPP Information Group - India
- Kapuas Tunggal Persada - Indonesia
- MS Steel International - UAE
- White Energy Company Limited
- PetroVietnam Power Coal Import and Supply Company
- European Bulk Services B.V. - Netherlands
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Price Waterhouse Coopers - Russia
- Coal and Oil Company - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Interocean Group of Companies - India
- Port Waratah Coal Services - Australia
- Pendopo Energi Batubara - Indonesia
- Petron Corporation, Philippines
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