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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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Wednesday, 17 June 20
KOREA SOUTHERN POWER CO INVITED 80000 MT OF LOW CALORIFIC VALUE COAL FOR AUGUST 1H, 2020 LOADING
COALspot.com: Korea Southern Power Co., Ltd. (KOSPO) has issued an International tender for 80,000 Metric Tons (MT) Min 4,200 kcal/kg - Max. ...
Tuesday, 16 June 20
A GLOBAL ECONOMIC SLUMP: WHAT WILL IT MEAN FOR METALS AND MINING? - WOOD MACKENZIE
Back before coronavirus knocked “normal” out cold, the key issues for miners were sub-investment prices, rising requirements for ESG an ...
Tuesday, 16 June 20
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX UP 0.58 PCT - XINHUA
China Taiyuan coal transaction price index stood at 124.43 points Monday, up 0.58 percent week on week.
The index, released by China ...
Tuesday, 16 June 20
HIGHER IRON ORE PRICES OFFSET CORONAVIRUS-DRIVEN PRODUCTION RISK - FITCH RATINGS
Lower iron ore production in Brazil, resulting from rising coronavirus infections, should only marginally affect the cash flow of Vale and other gl ...
Tuesday, 16 June 20
SHALE SHOCKED - WOOD MACKENZIE
Capturing shut-ins in real time
Oil markets are searching for balance as the world reflects on the impact of the COVID-19 pandemic. ...
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- Gujarat Mineral Development Corp Ltd - India
- Thiess Contractors Indonesia
- Ministry of Mines - Canada
- Indika Energy - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Interocean Group of Companies - India
- Independent Power Producers Association of India
- Latin American Coal - Colombia
- GVK Power & Infra Limited - India
- Thai Mozambique Logistica
- San Jose City I Power Corp, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- European Bulk Services B.V. - Netherlands
- Bukit Makmur.PT - Indonesia
- Indogreen Group - Indonesia
- Minerals Council of Australia
- Borneo Indobara - Indonesia
- Oldendorff Carriers - Singapore
- Globalindo Alam Lestari - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Bharathi Cement Corporation - India
- Planning Commission, India
- Aboitiz Power Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bhushan Steel Limited - India
- Barasentosa Lestari - Indonesia
- Wood Mackenzie - Singapore
- GMR Energy Limited - India
- Romanian Commodities Exchange
- The Treasury - Australian Government
- Manunggal Multi Energi - Indonesia
- Grasim Industreis Ltd - India
- Kumho Petrochemical, South Korea
- Karaikal Port Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- Price Waterhouse Coopers - Russia
- Central Electricity Authority - India
- International Coal Ventures Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Star Paper Mills Limited - India
- Indonesian Coal Mining Association
- Port Waratah Coal Services - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- VISA Power Limited - India
- Orica Mining Services - Indonesia
- Xindia Steels Limited - India
- Goldman Sachs - Singapore
- PTC India Limited - India
- Krishnapatnam Port Company Ltd. - India
- Malabar Cements Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Tata Chemicals Ltd - India
- Edison Trading Spa - Italy
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jindal Steel & Power Ltd - India
- Mercator Lines Limited - India
- Africa Commodities Group - South Africa
- Billiton Holdings Pty Ltd - Australia
- Aditya Birla Group - India
- Tamil Nadu electricity Board
- Parry Sugars Refinery, India
- Orica Australia Pty. Ltd.
- SMC Global Power, Philippines
- Formosa Plastics Group - Taiwan
- Electricity Generating Authority of Thailand
- Bulk Trading Sa - Switzerland
- Australian Coal Association
- Meenaskhi Energy Private Limited - India
- McConnell Dowell - Australia
- Simpson Spence & Young - Indonesia
- TeaM Sual Corporation - Philippines
- SMG Consultants - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Vedanta Resources Plc - India
- ICICI Bank Limited - India
- Bangladesh Power Developement Board
- Riau Bara Harum - Indonesia
- Antam Resourcindo - Indonesia
- Commonwealth Bank - Australia
- GN Power Mariveles Coal Plant, Philippines
- Carbofer General Trading SA - India
- ASAPP Information Group - India
- Global Green Power PLC Corporation, Philippines
- Altura Mining Limited, Indonesia
- Ministry of Transport, Egypt
- Singapore Mercantile Exchange
- Asmin Koalindo Tuhup - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Rio Tinto Coal - Australia
- South Luzon Thermal Energy Corporation
- PowerSource Philippines DevCo
- Attock Cement Pakistan Limited
- Therma Luzon, Inc, Philippines
- Semirara Mining and Power Corporation, Philippines
- Indian Oil Corporation Limited
- Energy Link Ltd, New Zealand
- London Commodity Brokers - England
- Economic Council, Georgia
- Sical Logistics Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Toyota Tsusho Corporation, Japan
- Wilmar Investment Holdings
- Renaissance Capital - South Africa
- Salva Resources Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Standard Chartered Bank - UAE
- Kohat Cement Company Ltd. - Pakistan
- Global Coal Blending Company Limited - Australia
- Meralco Power Generation, Philippines
- Bhoruka Overseas - Indonesia
- Maheswari Brothers Coal Limited - India
- Rashtriya Ispat Nigam Limited - India
- Global Business Power Corporation, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sarangani Energy Corporation, Philippines
- Jaiprakash Power Ventures ltd
- Deloitte Consulting - India
- Agrawal Coal Company - India
- Sindya Power Generating Company Private Ltd
- Kartika Selabumi Mining - Indonesia
- Anglo American - United Kingdom
- Essar Steel Hazira Ltd - India
- Central Java Power - Indonesia
- Heidelberg Cement - Germany
- Ind-Barath Power Infra Limited - India
- Indian Energy Exchange, India
- Cigading International Bulk Terminal - Indonesia
- Savvy Resources Ltd - HongKong
- White Energy Company Limited
- Samtan Co., Ltd - South Korea
- Holcim Trading Pte Ltd - Singapore
- Straits Asia Resources Limited - Singapore
- MS Steel International - UAE
- Bayan Resources Tbk. - Indonesia
- IHS Mccloskey Coal Group - USA
- Coal and Oil Company - UAE
- Energy Development Corp, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Miang Besar Coal Terminal - Indonesia
- Uttam Galva Steels Limited - India
- Directorate Of Revenue Intelligence - India
- Leighton Contractors Pty Ltd - Australia
- Banpu Public Company Limited - Thailand
- Gujarat Sidhee Cement - India
- SN Aboitiz Power Inc, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Timah Investasi Mineral - Indoneisa
- Chettinad Cement Corporation Ltd - India
- Petron Corporation, Philippines
- Sakthi Sugars Limited - India
- Maharashtra Electricity Regulatory Commission - India
- IEA Clean Coal Centre - UK
- Trasteel International SA, Italy
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mjunction Services Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Lanco Infratech Ltd - India
- Sojitz Corporation - Japan
- Ministry of Finance - Indonesia
- OPG Power Generation Pvt Ltd - India
- Bukit Baiduri Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Dalmia Cement Bharat India
- Ambuja Cements Ltd - India
- Iligan Light & Power Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Mercuria Energy - Indonesia
- Bhatia International Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Semirara Mining Corp, Philippines
- Baramulti Group, Indonesia
- Eastern Energy - Thailand
- Marubeni Corporation - India
- CIMB Investment Bank - Malaysia
- The State Trading Corporation of India Ltd
- Mintek Dendrill Indonesia
- New Zealand Coal & Carbon
- Kobexindo Tractors - Indoneisa
- Indo Tambangraya Megah - Indonesia
- Binh Thuan Hamico - Vietnam
- Gujarat Electricity Regulatory Commission - India
- Medco Energi Mining Internasional
- Pendopo Energi Batubara - Indonesia
- The University of Queensland
- Cement Manufacturers Association - India
- GAC Shipping (India) Pvt Ltd
- Kepco SPC Power Corporation, Philippines
- Videocon Industries ltd - India
- Georgia Ports Authority, United States
- Australian Commodity Traders Exchange
- Siam City Cement PLC, Thailand
- Vijayanagar Sugar Pvt Ltd - India
- CNBM International Corporation - China
- Coastal Gujarat Power Limited - India
- Posco Energy - South Korea
- Eastern Coal Council - USA
- Parliament of New Zealand
- Madhucon Powers Ltd - India
- Intertek Mineral Services - Indonesia
- India Bulls Power Limited - India
- AsiaOL BioFuels Corp., Philippines
- Electricity Authority, New Zealand
- Metalloyd Limited - United Kingdom
- Coalindo Energy - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kaltim Prima Coal - Indonesia
- Siam City Cement - Thailand
- PNOC Exploration Corporation - Philippines
- LBH Netherlands Bv - Netherlands
- Makarim & Taira - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Merrill Lynch Commodities Europe
- Alfred C Toepfer International GmbH - Germany
- Directorate General of MIneral and Coal - Indonesia
- Power Finance Corporation Ltd., India
- Chamber of Mines of South Africa
- Larsen & Toubro Limited - India
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