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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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Tuesday, 09 June 20
INDIA: COAL IMPORT DROPS BY 20% TO NEARLY 19 MILLION TONNES IN MAY, SAYS REPORT - HINDUSTAN TIMES
The country’s coal import dropped by 20 per cent to 18.93 million tonnes (MT) last month, industry data showed.
The government ...
Monday, 08 June 20
WOOD MACKENZIE: THE INDISPENSABLE OPEC+
Rumours of “the death of OPEC” have been circulating for almost as long as the organisation has existed. Just three years after the car ...
Monday, 08 June 20
CHINA'S COAL IMPORTS FALL NEARLY 20% IN MAY EVEN AS DEMAND RISES - REUTERS
China’s coal imports in May fell nearly 20% compared with a year earlier even as demand recovered at power plants and industrial users, custo ...
Monday, 08 June 20
JUNE 2020 INDONESIAN COAL PRICE REFERENCE HIT US$ 52.98 A TON, ITS LOWEST LEVEL SINCE AT LEAST AUGUST 2016
COALspot.com: The Ministry of Energy and Mineral Resources of the Republic of Indonesia has revised down again the benchmark price of Indonesian th ...
Sunday, 07 June 20
A SCRUBBER FITTED 61,000 ULTRAMAX WAS FIXED DELIVERY PHILIPPINES TRIP VIA SOUTH AFRICA REDELIVERY VIETNAM AT $9,500 - BALTIC BRIEFING
Capesize
The small flicker of hope at the beginning of this week has kindled a small fire under the Capesize market. At a paltry $3369 from the ...
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- Marubeni Corporation - India
- SMG Consultants - Indonesia
- Chettinad Cement Corporation Ltd - India
- Altura Mining Limited, Indonesia
- Kaltim Prima Coal - Indonesia
- Binh Thuan Hamico - Vietnam
- Kohat Cement Company Ltd. - Pakistan
- MS Steel International - UAE
- PTC India Limited - India
- Malabar Cements Ltd - India
- Eastern Energy - Thailand
- Semirara Mining Corp, Philippines
- Chamber of Mines of South Africa
- Global Green Power PLC Corporation, Philippines
- Tata Chemicals Ltd - India
- Indonesian Coal Mining Association
- Ambuja Cements Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- European Bulk Services B.V. - Netherlands
- Agrawal Coal Company - India
- Oldendorff Carriers - Singapore
- Attock Cement Pakistan Limited
- Electricity Authority, New Zealand
- Romanian Commodities Exchange
- Holcim Trading Pte Ltd - Singapore
- Commonwealth Bank - Australia
- Sinarmas Energy and Mining - Indonesia
- Petron Corporation, Philippines
- Larsen & Toubro Limited - India
- Wood Mackenzie - Singapore
- Cement Manufacturers Association - India
- Energy Development Corp, Philippines
- Straits Asia Resources Limited - Singapore
- Africa Commodities Group - South Africa
- Standard Chartered Bank - UAE
- Jindal Steel & Power Ltd - India
- ASAPP Information Group - India
- Ministry of Finance - Indonesia
- Dalmia Cement Bharat India
- The State Trading Corporation of India Ltd
- Sakthi Sugars Limited - India
- OPG Power Generation Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Posco Energy - South Korea
- Sindya Power Generating Company Private Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Bharathi Cement Corporation - India
- Coastal Gujarat Power Limited - India
- Globalindo Alam Lestari - Indonesia
- Lanco Infratech Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Tamil Nadu electricity Board
- Bank of Tokyo Mitsubishi UFJ Ltd
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- IHS Mccloskey Coal Group - USA
- Alfred C Toepfer International GmbH - Germany
- Makarim & Taira - Indonesia
- Sojitz Corporation - Japan
- Banpu Public Company Limited - Thailand
- Essar Steel Hazira Ltd - India
- Siam City Cement - Thailand
- Riau Bara Harum - Indonesia
- Karaikal Port Pvt Ltd - India
- Global Business Power Corporation, Philippines
- Energy Link Ltd, New Zealand
- Antam Resourcindo - Indonesia
- Gujarat Sidhee Cement - India
- Bulk Trading Sa - Switzerland
- Jaiprakash Power Ventures ltd
- Interocean Group of Companies - India
- Maharashtra Electricity Regulatory Commission - India
- South Luzon Thermal Energy Corporation
- Rio Tinto Coal - Australia
- Mercuria Energy - Indonesia
- Electricity Generating Authority of Thailand
- Directorate General of MIneral and Coal - Indonesia
- Indo Tambangraya Megah - Indonesia
- Australian Coal Association
- Leighton Contractors Pty Ltd - Australia
- Salva Resources Pvt Ltd - India
- PowerSource Philippines DevCo
- Maheswari Brothers Coal Limited - India
- Planning Commission, India
- Rashtriya Ispat Nigam Limited - India
- Ministry of Transport, Egypt
- Meenaskhi Energy Private Limited - India
- Borneo Indobara - Indonesia
- Directorate Of Revenue Intelligence - India
- Billiton Holdings Pty Ltd - Australia
- Thai Mozambique Logistica
- SMC Global Power, Philippines
- Samtan Co., Ltd - South Korea
- Georgia Ports Authority, United States
- Vizag Seaport Private Limited - India
- Siam City Cement PLC, Thailand
- Ind-Barath Power Infra Limited - India
- Heidelberg Cement - Germany
- The University of Queensland
- Power Finance Corporation Ltd., India
- IEA Clean Coal Centre - UK
- Medco Energi Mining Internasional
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mjunction Services Limited - India
- Manunggal Multi Energi - Indonesia
- Bhatia International Limited - India
- Central Electricity Authority - India
- Aditya Birla Group - India
- Sree Jayajothi Cements Limited - India
- Central Java Power - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Indian Energy Exchange, India
- Gujarat Mineral Development Corp Ltd - India
- Singapore Mercantile Exchange
- Orica Australia Pty. Ltd.
- GVK Power & Infra Limited - India
- India Bulls Power Limited - India
- Meralco Power Generation, Philippines
- Metalloyd Limited - United Kingdom
- Latin American Coal - Colombia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Bukit Baiduri Energy - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Kartika Selabumi Mining - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Simpson Spence & Young - Indonesia
- Iligan Light & Power Inc, Philippines
- White Energy Company Limited
- Pendopo Energi Batubara - Indonesia
- Uttam Galva Steels Limited - India
- Intertek Mineral Services - Indonesia
- Deloitte Consulting - India
- Carbofer General Trading SA - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- International Coal Ventures Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Neyveli Lignite Corporation Ltd, - India
- Wilmar Investment Holdings
- Sical Logistics Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Toyota Tsusho Corporation, Japan
- TNB Fuel Sdn Bhd - Malaysia
- Minerals Council of Australia
- GAC Shipping (India) Pvt Ltd
- Aboitiz Power Corporation - Philippines
- Indogreen Group - Indonesia
- Bangladesh Power Developement Board
- Thiess Contractors Indonesia
- Barasentosa Lestari - Indonesia
- Kepco SPC Power Corporation, Philippines
- Bhushan Steel Limited - India
- Ministry of Mines - Canada
- McConnell Dowell - Australia
- Bukit Makmur.PT - Indonesia
- Coal and Oil Company - UAE
- Videocon Industries ltd - India
- New Zealand Coal & Carbon
- Krishnapatnam Port Company Ltd. - India
- Goldman Sachs - Singapore
- SN Aboitiz Power Inc, Philippines
- Grasim Industreis Ltd - India
- Australian Commodity Traders Exchange
- Sarangani Energy Corporation, Philippines
- CNBM International Corporation - China
- Kobexindo Tractors - Indoneisa
- Indika Energy - Indonesia
- Eastern Coal Council - USA
- Merrill Lynch Commodities Europe
- Global Coal Blending Company Limited - Australia
- San Jose City I Power Corp, Philippines
- CIMB Investment Bank - Malaysia
- Vijayanagar Sugar Pvt Ltd - India
- Indian Oil Corporation Limited
- Savvy Resources Ltd - HongKong
- Formosa Plastics Group - Taiwan
- Mintek Dendrill Indonesia
- Kideco Jaya Agung - Indonesia
- Bhoruka Overseas - Indonesia
- Coalindo Energy - Indonesia
- The Treasury - Australian Government
- GMR Energy Limited - India
- Economic Council, Georgia
- ICICI Bank Limited - India
- Bayan Resources Tbk. - Indonesia
- Independent Power Producers Association of India
- Kumho Petrochemical, South Korea
- Trasteel International SA, Italy
- Miang Besar Coal Terminal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Parry Sugars Refinery, India
- Asmin Koalindo Tuhup - Indonesia
- Star Paper Mills Limited - India
- Edison Trading Spa - Italy
- Madhucon Powers Ltd - India
- Vedanta Resources Plc - India
- Orica Mining Services - Indonesia
- Parliament of New Zealand
- VISA Power Limited - India
- LBH Netherlands Bv - Netherlands
- Anglo American - United Kingdom
- PNOC Exploration Corporation - Philippines
- Mercator Lines Limited - India
- Ceylon Electricity Board - Sri Lanka
- Therma Luzon, Inc, Philippines
- Port Waratah Coal Services - Australia
- Cigading International Bulk Terminal - Indonesia
- Baramulti Group, Indonesia
- Semirara Mining and Power Corporation, Philippines
- Renaissance Capital - South Africa
- Price Waterhouse Coopers - Russia
- PetroVietnam Power Coal Import and Supply Company
- London Commodity Brokers - England
- Xindia Steels Limited - India
- TeaM Sual Corporation - Philippines
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