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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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- Ministry of Mines - Canada
- Bangladesh Power Developement Board
- LBH Netherlands Bv - Netherlands
- Chettinad Cement Corporation Ltd - India
- Meralco Power Generation, Philippines
- Coastal Gujarat Power Limited - India
- Directorate Of Revenue Intelligence - India
- Thai Mozambique Logistica
- ICICI Bank Limited - India
- Timah Investasi Mineral - Indoneisa
- Energy Development Corp, Philippines
- Straits Asia Resources Limited - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Oldendorff Carriers - Singapore
- Latin American Coal - Colombia
- Australian Coal Association
- Lanco Infratech Ltd - India
- Tamil Nadu electricity Board
- Toyota Tsusho Corporation, Japan
- Siam City Cement PLC, Thailand
- Georgia Ports Authority, United States
- Tata Chemicals Ltd - India
- Minerals Council of Australia
- Indonesian Coal Mining Association
- Kartika Selabumi Mining - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- SN Aboitiz Power Inc, Philippines
- Kumho Petrochemical, South Korea
- Sindya Power Generating Company Private Ltd
- Ceylon Electricity Board - Sri Lanka
- TeaM Sual Corporation - Philippines
- Planning Commission, India
- Ambuja Cements Ltd - India
- The Treasury - Australian Government
- Grasim Industreis Ltd - India
- Central Electricity Authority - India
- Directorate General of MIneral and Coal - Indonesia
- Indian Energy Exchange, India
- The State Trading Corporation of India Ltd
- VISA Power Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Orica Australia Pty. Ltd.
- Uttam Galva Steels Limited - India
- AsiaOL BioFuels Corp., Philippines
- Manunggal Multi Energi - Indonesia
- Standard Chartered Bank - UAE
- Semirara Mining and Power Corporation, Philippines
- Intertek Mineral Services - Indonesia
- South Luzon Thermal Energy Corporation
- CIMB Investment Bank - Malaysia
- Marubeni Corporation - India
- Xindia Steels Limited - India
- Economic Council, Georgia
- Binh Thuan Hamico - Vietnam
- Savvy Resources Ltd - HongKong
- Interocean Group of Companies - India
- Makarim & Taira - Indonesia
- Larsen & Toubro Limited - India
- Bhoruka Overseas - Indonesia
- European Bulk Services B.V. - Netherlands
- Australian Commodity Traders Exchange
- Samtan Co., Ltd - South Korea
- Bukit Baiduri Energy - Indonesia
- PTC India Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kepco SPC Power Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Commonwealth Bank - Australia
- Malabar Cements Ltd - India
- SMG Consultants - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Essar Steel Hazira Ltd - India
- Energy Link Ltd, New Zealand
- PNOC Exploration Corporation - Philippines
- Power Finance Corporation Ltd., India
- Mercuria Energy - Indonesia
- Cement Manufacturers Association - India
- GVK Power & Infra Limited - India
- Petron Corporation, Philippines
- Indogreen Group - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Madhucon Powers Ltd - India
- Port Waratah Coal Services - Australia
- Coal and Oil Company - UAE
- SMC Global Power, Philippines
- San Jose City I Power Corp, Philippines
- Rio Tinto Coal - Australia
- Carbofer General Trading SA - India
- Vedanta Resources Plc - India
- Bhatia International Limited - India
- Jaiprakash Power Ventures ltd
- Dalmia Cement Bharat India
- Posco Energy - South Korea
- Vizag Seaport Private Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Indika Energy - Indonesia
- Ministry of Finance - Indonesia
- India Bulls Power Limited - India
- Barasentosa Lestari - Indonesia
- New Zealand Coal & Carbon
- Kobexindo Tractors - Indoneisa
- Global Green Power PLC Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Videocon Industries ltd - India
- Coalindo Energy - Indonesia
- Baramulti Group, Indonesia
- Kideco Jaya Agung - Indonesia
- Gujarat Sidhee Cement - India
- Attock Cement Pakistan Limited
- Thiess Contractors Indonesia
- Alfred C Toepfer International GmbH - Germany
- Therma Luzon, Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- White Energy Company Limited
- Sical Logistics Limited - India
- Star Paper Mills Limited - India
- Agrawal Coal Company - India
- GMR Energy Limited - India
- Independent Power Producers Association of India
- PetroVietnam Power Coal Import and Supply Company
- Wood Mackenzie - Singapore
- Petrochimia International Co. Ltd.- Taiwan
- Salva Resources Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Simpson Spence & Young - Indonesia
- Central Java Power - Indonesia
- Semirara Mining Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Borneo Indobara - Indonesia
- Deloitte Consulting - India
- MS Steel International - UAE
- Sarangani Energy Corporation, Philippines
- Electricity Generating Authority of Thailand
- Electricity Authority, New Zealand
- Bharathi Cement Corporation - India
- Altura Mining Limited, Indonesia
- Aboitiz Power Corporation - Philippines
- Bulk Trading Sa - Switzerland
- GAC Shipping (India) Pvt Ltd
- Global Business Power Corporation, Philippines
- Sakthi Sugars Limited - India
- Indo Tambangraya Megah - Indonesia
- Globalindo Alam Lestari - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Billiton Holdings Pty Ltd - Australia
- Trasteel International SA, Italy
- Siam City Cement - Thailand
- Bukit Makmur.PT - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Iligan Light & Power Inc, Philippines
- Meenaskhi Energy Private Limited - India
- Anglo American - United Kingdom
- Eastern Coal Council - USA
- Krishnapatnam Port Company Ltd. - India
- Kapuas Tunggal Persada - Indonesia
- Mercator Lines Limited - India
- Formosa Plastics Group - Taiwan
- Wilmar Investment Holdings
- Bahari Cakrawala Sebuku - Indonesia
- Medco Energi Mining Internasional
- PowerSource Philippines DevCo
- Chamber of Mines of South Africa
- TNB Fuel Sdn Bhd - Malaysia
- ASAPP Information Group - India
- Antam Resourcindo - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Karaikal Port Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ministry of Transport, Egypt
- Orica Mining Services - Indonesia
- Gujarat Electricity Regulatory Commission - India
- London Commodity Brokers - England
- Mintek Dendrill Indonesia
- Eastern Energy - Thailand
- Ind-Barath Power Infra Limited - India
- Singapore Mercantile Exchange
- Sojitz Corporation - Japan
- Metalloyd Limited - United Kingdom
- Renaissance Capital - South Africa
- Sree Jayajothi Cements Limited - India
- Goldman Sachs - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Heidelberg Cement - Germany
- Africa Commodities Group - South Africa
- Cigading International Bulk Terminal - Indonesia
- Indian Oil Corporation Limited
- IEA Clean Coal Centre - UK
- GN Power Mariveles Coal Plant, Philippines
- Mjunction Services Limited - India
- Price Waterhouse Coopers - Russia
- Holcim Trading Pte Ltd - Singapore
- IHS Mccloskey Coal Group - USA
- Bank of Tokyo Mitsubishi UFJ Ltd
- Parliament of New Zealand
- Jindal Steel & Power Ltd - India
- Parry Sugars Refinery, India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Global Coal Blending Company Limited - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- The University of Queensland
- Aditya Birla Group - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Romanian Commodities Exchange
- Neyveli Lignite Corporation Ltd, - India
- Kaltim Prima Coal - Indonesia
- Banpu Public Company Limited - Thailand
- Miang Besar Coal Terminal - Indonesia
- Bhushan Steel Limited - India
- Maheswari Brothers Coal Limited - India
- McConnell Dowell - Australia
- Riau Bara Harum - Indonesia
- Edison Trading Spa - Italy
- CNBM International Corporation - China
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