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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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Sunday, 14 June 20
INDONESIAN COAL WAS STILL IN DEMAND; A 52,000-DWT SUPRAMAX FIXING DELIVERY CJK FOR A ROUND VOYAGE VIA INDONESIA AT $6,250 - BALTIC BRIEFING
Capesize
The Capesize market made new highs for the year this week after strong iron ore demand to the far east continued to develop in the mar ...
Friday, 12 June 20
CHINA CURBS COAL IMPORTS AFTER 5 MONTHS OF RECORD INFLOWS - SOURCES: REUTERS
China has stepped up customs checks for coal imports, leading to lengthy processing delays at ports, four sources familiar with the matter said, as ...
Friday, 12 June 20
COAL INDIA LIMITED SET FOR MARKETING DRIVE TO CREATE DEMAND - FINANCIAL EXPRESS
State-run miner Coal India (CIL), which is primarily focused on supplying coal to the power sector, is now reorienting its marketing to create dema ...
Friday, 12 June 20
MOODY'S REVISES BRENT OIL PRICE OUTLOOK TO $35/BARREL IN 2020 - TASS
Low oil prices are likely to exert the highest pressure on Iraq, Oman and Kuwait due to the limited space for the fiscal policy pursuit and higher ...
Thursday, 11 June 20
JAN-MAY, INDONESIA SHIPPED 175.15 MILLION TONS OF COAL TO ITS OVERSEAS BUYERS
Indonesia's coal production for the first 5 months of this year have reached 228 million tons. January – May 2020, Indonesia shipped US$ ...
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- Miang Besar Coal Terminal - Indonesia
- Global Green Power PLC Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Uttam Galva Steels Limited - India
- Power Finance Corporation Ltd., India
- New Zealand Coal & Carbon
- Sical Logistics Limited - India
- Formosa Plastics Group - Taiwan
- Bayan Resources Tbk. - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Edison Trading Spa - Italy
- Maharashtra Electricity Regulatory Commission - India
- Therma Luzon, Inc, Philippines
- Metalloyd Limited - United Kingdom
- PowerSource Philippines DevCo
- Star Paper Mills Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Eastern Energy - Thailand
- Pipit Mutiara Jaya. PT, Indonesia
- MS Steel International - UAE
- Africa Commodities Group - South Africa
- SMC Global Power, Philippines
- Aboitiz Power Corporation - Philippines
- The Treasury - Australian Government
- Kalimantan Lumbung Energi - Indonesia
- OPG Power Generation Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Indo Tambangraya Megah - Indonesia
- Ministry of Transport, Egypt
- Salva Resources Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Kaltim Prima Coal - Indonesia
- Siam City Cement - Thailand
- Latin American Coal - Colombia
- Eastern Coal Council - USA
- Indogreen Group - Indonesia
- Jindal Steel & Power Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mjunction Services Limited - India
- Maheswari Brothers Coal Limited - India
- Wood Mackenzie - Singapore
- Sinarmas Energy and Mining - Indonesia
- London Commodity Brokers - England
- Thiess Contractors Indonesia
- Electricity Generating Authority of Thailand
- Gujarat Sidhee Cement - India
- Kepco SPC Power Corporation, Philippines
- Lanco Infratech Ltd - India
- Karaikal Port Pvt Ltd - India
- Bhatia International Limited - India
- Global Coal Blending Company Limited - Australia
- Meralco Power Generation, Philippines
- Samtan Co., Ltd - South Korea
- Grasim Industreis Ltd - India
- Romanian Commodities Exchange
- San Jose City I Power Corp, Philippines
- Kohat Cement Company Ltd. - Pakistan
- GMR Energy Limited - India
- Electricity Authority, New Zealand
- Agrawal Coal Company - India
- Manunggal Multi Energi - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Central Electricity Authority - India
- Kumho Petrochemical, South Korea
- ICICI Bank Limited - India
- Cigading International Bulk Terminal - Indonesia
- Carbofer General Trading SA - India
- Toyota Tsusho Corporation, Japan
- Energy Link Ltd, New Zealand
- Kartika Selabumi Mining - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Savvy Resources Ltd - HongKong
- Directorate General of MIneral and Coal - Indonesia
- India Bulls Power Limited - India
- Jaiprakash Power Ventures ltd
- Orica Mining Services - Indonesia
- Thai Mozambique Logistica
- Georgia Ports Authority, United States
- Kapuas Tunggal Persada - Indonesia
- Sree Jayajothi Cements Limited - India
- Banpu Public Company Limited - Thailand
- Indika Energy - Indonesia
- Ministry of Finance - Indonesia
- Chamber of Mines of South Africa
- Sarangani Energy Corporation, Philippines
- Central Java Power - Indonesia
- CIMB Investment Bank - Malaysia
- The State Trading Corporation of India Ltd
- Pendopo Energi Batubara - Indonesia
- Riau Bara Harum - Indonesia
- McConnell Dowell - Australia
- Global Business Power Corporation, Philippines
- Coastal Gujarat Power Limited - India
- Parliament of New Zealand
- Deloitte Consulting - India
- Attock Cement Pakistan Limited
- Sakthi Sugars Limited - India
- Kobexindo Tractors - Indoneisa
- Cement Manufacturers Association - India
- Barasentosa Lestari - Indonesia
- Malabar Cements Ltd - India
- Rio Tinto Coal - Australia
- Bhoruka Overseas - Indonesia
- Posco Energy - South Korea
- Indonesian Coal Mining Association
- Renaissance Capital - South Africa
- IHS Mccloskey Coal Group - USA
- White Energy Company Limited
- Singapore Mercantile Exchange
- Gujarat Electricity Regulatory Commission - India
- Economic Council, Georgia
- Larsen & Toubro Limited - India
- GVK Power & Infra Limited - India
- Australian Coal Association
- Indian Energy Exchange, India
- SN Aboitiz Power Inc, Philippines
- Rashtriya Ispat Nigam Limited - India
- Kideco Jaya Agung - Indonesia
- Parry Sugars Refinery, India
- Leighton Contractors Pty Ltd - Australia
- Minerals Council of Australia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Port Waratah Coal Services - Australia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Tata Chemicals Ltd - India
- PTC India Limited - India
- Bukit Baiduri Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Bhushan Steel Limited - India
- Vedanta Resources Plc - India
- Iligan Light & Power Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Marubeni Corporation - India
- Ceylon Electricity Board - Sri Lanka
- South Luzon Thermal Energy Corporation
- Standard Chartered Bank - UAE
- Binh Thuan Hamico - Vietnam
- Globalindo Alam Lestari - Indonesia
- Sojitz Corporation - Japan
- Semirara Mining and Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- Chettinad Cement Corporation Ltd - India
- Mercator Lines Limited - India
- Sindya Power Generating Company Private Ltd
- Merrill Lynch Commodities Europe
- Vijayanagar Sugar Pvt Ltd - India
- Borneo Indobara - Indonesia
- Tamil Nadu electricity Board
- TNB Fuel Sdn Bhd - Malaysia
- Heidelberg Cement - Germany
- European Bulk Services B.V. - Netherlands
- PetroVietnam Power Coal Import and Supply Company
- Mercuria Energy - Indonesia
- Semirara Mining Corp, Philippines
- Videocon Industries ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Indian Oil Corporation Limited
- Essar Steel Hazira Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Bahari Cakrawala Sebuku - Indonesia
- Petron Corporation, Philippines
- Ministry of Mines - Canada
- Straits Asia Resources Limited - Singapore
- Holcim Trading Pte Ltd - Singapore
- Aditya Birla Group - India
- Orica Australia Pty. Ltd.
- Siam City Cement PLC, Thailand
- Commonwealth Bank - Australia
- International Coal Ventures Pvt Ltd - India
- Independent Power Producers Association of India
- Jorong Barutama Greston.PT - Indonesia
- Bulk Trading Sa - Switzerland
- Ambuja Cements Ltd - India
- Makarim & Taira - Indonesia
- LBH Netherlands Bv - Netherlands
- Coal and Oil Company - UAE
- Simpson Spence & Young - Indonesia
- Australian Commodity Traders Exchange
- Baramulti Group, Indonesia
- Medco Energi Mining Internasional
- Planning Commission, India
- SMG Consultants - Indonesia
- Altura Mining Limited, Indonesia
- ASAPP Information Group - India
- Meenaskhi Energy Private Limited - India
- Billiton Holdings Pty Ltd - Australia
- Coalindo Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Goldman Sachs - Singapore
- Timah Investasi Mineral - Indoneisa
- Bharathi Cement Corporation - India
- Bangladesh Power Developement Board
- Xindia Steels Limited - India
- TeaM Sual Corporation - Philippines
- VISA Power Limited - India
- IEA Clean Coal Centre - UK
- PNOC Exploration Corporation - Philippines
- Energy Development Corp, Philippines
- The University of Queensland
- Trasteel International SA, Italy
- Bukit Makmur.PT - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Alfred C Toepfer International GmbH - Germany
- Dalmia Cement Bharat India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Directorate Of Revenue Intelligence - India
- Oldendorff Carriers - Singapore
- Madhucon Powers Ltd - India
- CNBM International Corporation - China
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Mintek Dendrill Indonesia
- Anglo American - United Kingdom
- Bukit Asam (Persero) Tbk - Indonesia
- Interocean Group of Companies - India
- Wilmar Investment Holdings
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