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