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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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Saturday, 06 June 20
KOREA SOUTH-EAST POWER CO INVITED COAL BIDS FOR MIN 5600 NCV COAL
COALspot.com: South Korea’s KOREA SOUTH-EAST POWER CO., LTD. (KOEN) has issued an international tender for 270,000 Tons (MT) min. 5600 NCV co ...
Friday, 05 June 20
COAL INDIA ESTIMATES PRODUCTION GROWTH BY OVERBURDEN REMOVAL - FINANCIAL EXPRESS
PSU miner Coal India (CIL) has now limited mining only to Overburden Removal (OBR) with falling demand of coal. The mining behemoth is now keeping ...
Friday, 05 June 20
U.S. SANCTIONS COMPLIANCE GUIDANCE RELEASED FOR THE GLOBAL MARITIME, ENERGY AND METALS SECTORS - AKIN GUMP
Key Points
On May 14, 2020, OFAC, the Department of State and the U.S. Coast Guard jointly released guidance for persons involved in the ma ...
Friday, 05 June 20
IN THE FIRST 5 MONTHS OF 2020 AUSTRALIA SHIPPED 6.8 MLN TONNES TO VIETNAM - BANCHERO COSTA
In the first 5 months of 2020, global seaborne coal trade declined by as much as -8% year-on-year, according to vessel tracking data from Ref ...
Thursday, 04 June 20
CHINA'S BENCHMARK POWER COAL PRICE EDGES UP - XINHUA
China’s benchmark power coal price rose slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
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- Jorong Barutama Greston.PT - Indonesia
- Planning Commission, India
- Leighton Contractors Pty Ltd - Australia
- Ministry of Mines - Canada
- Savvy Resources Ltd - HongKong
- Goldman Sachs - Singapore
- Australian Coal Association
- CIMB Investment Bank - Malaysia
- Heidelberg Cement - Germany
- Parry Sugars Refinery, India
- Bhoruka Overseas - Indonesia
- Coal and Oil Company - UAE
- Electricity Generating Authority of Thailand
- Orica Mining Services - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Siam City Cement PLC, Thailand
- Star Paper Mills Limited - India
- Merrill Lynch Commodities Europe
- Tata Chemicals Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Wood Mackenzie - Singapore
- Energy Development Corp, Philippines
- Uttam Galva Steels Limited - India
- Edison Trading Spa - Italy
- Karbindo Abesyapradhi - Indoneisa
- Jindal Steel & Power Ltd - India
- Borneo Indobara - Indonesia
- Indian Oil Corporation Limited
- PTC India Limited - India
- Latin American Coal - Colombia
- Bayan Resources Tbk. - Indonesia
- Sical Logistics Limited - India
- White Energy Company Limited
- Ministry of Transport, Egypt
- Thai Mozambique Logistica
- Intertek Mineral Services - Indonesia
- New Zealand Coal & Carbon
- Kapuas Tunggal Persada - Indonesia
- Dalmia Cement Bharat India
- Cigading International Bulk Terminal - Indonesia
- GVK Power & Infra Limited - India
- Thiess Contractors Indonesia
- Interocean Group of Companies - India
- GMR Energy Limited - India
- Sojitz Corporation - Japan
- Gujarat Sidhee Cement - India
- CNBM International Corporation - China
- Kumho Petrochemical, South Korea
- Straits Asia Resources Limited - Singapore
- Malabar Cements Ltd - India
- OPG Power Generation Pvt Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- India Bulls Power Limited - India
- Global Coal Blending Company Limited - Australia
- Meenaskhi Energy Private Limited - India
- Mercator Lines Limited - India
- Sree Jayajothi Cements Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Barasentosa Lestari - Indonesia
- Posco Energy - South Korea
- Timah Investasi Mineral - Indoneisa
- Bukit Asam (Persero) Tbk - Indonesia
- London Commodity Brokers - England
- Gujarat Electricity Regulatory Commission - India
- Vijayanagar Sugar Pvt Ltd - India
- Krishnapatnam Port Company Ltd. - India
- PowerSource Philippines DevCo
- Central Java Power - Indonesia
- Ind-Barath Power Infra Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Economic Council, Georgia
- Bharathi Cement Corporation - India
- Wilmar Investment Holdings
- Australian Commodity Traders Exchange
- Salva Resources Pvt Ltd - India
- Meralco Power Generation, Philippines
- Xindia Steels Limited - India
- Binh Thuan Hamico - Vietnam
- Indo Tambangraya Megah - Indonesia
- Deloitte Consulting - India
- Mjunction Services Limited - India
- The Treasury - Australian Government
- Trasteel International SA, Italy
- Marubeni Corporation - India
- Grasim Industreis Ltd - India
- Romanian Commodities Exchange
- Tamil Nadu electricity Board
- Price Waterhouse Coopers - Russia
- Ambuja Cements Ltd - India
- TeaM Sual Corporation - Philippines
- Commonwealth Bank - Australia
- Indogreen Group - Indonesia
- IEA Clean Coal Centre - UK
- Sindya Power Generating Company Private Ltd
- Essar Steel Hazira Ltd - India
- Electricity Authority, New Zealand
- AsiaOL BioFuels Corp., Philippines
- Makarim & Taira - Indonesia
- Power Finance Corporation Ltd., India
- Indika Energy - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Independent Power Producers Association of India
- Therma Luzon, Inc, Philippines
- Jaiprakash Power Ventures ltd
- Kobexindo Tractors - Indoneisa
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bukit Makmur.PT - Indonesia
- Sakthi Sugars Limited - India
- Lanco Infratech Ltd - India
- European Bulk Services B.V. - Netherlands
- Oldendorff Carriers - Singapore
- Carbofer General Trading SA - India
- Karaikal Port Pvt Ltd - India
- Antam Resourcindo - Indonesia
- Orica Australia Pty. Ltd.
- VISA Power Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Cement Manufacturers Association - India
- Asmin Koalindo Tuhup - Indonesia
- Global Business Power Corporation, Philippines
- Baramulti Group, Indonesia
- Medco Energi Mining Internasional
- Directorate General of MIneral and Coal - Indonesia
- Pendopo Energi Batubara - Indonesia
- Mercuria Energy - Indonesia
- Petron Corporation, Philippines
- Ministry of Finance - Indonesia
- Vedanta Resources Plc - India
- PNOC Exploration Corporation - Philippines
- Eastern Coal Council - USA
- Singapore Mercantile Exchange
- Sinarmas Energy and Mining - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Parliament of New Zealand
- Siam City Cement - Thailand
- Renaissance Capital - South Africa
- Altura Mining Limited, Indonesia
- Central Electricity Authority - India
- Port Waratah Coal Services - Australia
- Global Green Power PLC Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Billiton Holdings Pty Ltd - Australia
- Videocon Industries ltd - India
- Vizag Seaport Private Limited - India
- MS Steel International - UAE
- Maheswari Brothers Coal Limited - India
- Madhucon Powers Ltd - India
- Africa Commodities Group - South Africa
- Samtan Co., Ltd - South Korea
- Bank of Tokyo Mitsubishi UFJ Ltd
- Banpu Public Company Limited - Thailand
- Indian Energy Exchange, India
- Energy Link Ltd, New Zealand
- Formosa Plastics Group - Taiwan
- Offshore Bulk Terminal Pte Ltd, Singapore
- San Jose City I Power Corp, Philippines
- Miang Besar Coal Terminal - Indonesia
- Standard Chartered Bank - UAE
- SMG Consultants - Indonesia
- Coalindo Energy - Indonesia
- Coastal Gujarat Power Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Bukit Baiduri Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- ASAPP Information Group - India
- Maharashtra Electricity Regulatory Commission - India
- Bhushan Steel Limited - India
- IHS Mccloskey Coal Group - USA
- Kaltim Prima Coal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Rio Tinto Coal - Australia
- SMC Global Power, Philippines
- Toyota Tsusho Corporation, Japan
- Mintek Dendrill Indonesia
- Aboitiz Power Corporation - Philippines
- ICICI Bank Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bhatia International Limited - India
- GAC Shipping (India) Pvt Ltd
- Chamber of Mines of South Africa
- Holcim Trading Pte Ltd - Singapore
- Aditya Birla Group - India
- Simpson Spence & Young - Indonesia
- SN Aboitiz Power Inc, Philippines
- South Luzon Thermal Energy Corporation
- Minerals Council of Australia
- Semirara Mining Corp, Philippines
- The University of Queensland
- Gujarat Mineral Development Corp Ltd - India
- Agrawal Coal Company - India
- The State Trading Corporation of India Ltd
- Larsen & Toubro Limited - India
- Sarangani Energy Corporation, Philippines
- Kideco Jaya Agung - Indonesia
- Chettinad Cement Corporation Ltd - India
- Kepco SPC Power Corporation, Philippines
- Riau Bara Harum - Indonesia
- LBH Netherlands Bv - Netherlands
- Semirara Mining and Power Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Indonesian Coal Mining Association
- Bulk Trading Sa - Switzerland
- Directorate Of Revenue Intelligence - India
- Kartika Selabumi Mining - Indonesia
- International Coal Ventures Pvt Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Metalloyd Limited - United Kingdom
- McConnell Dowell - Australia
- Eastern Energy - Thailand
- Attock Cement Pakistan Limited
- Anglo American - United Kingdom
- Manunggal Multi Energi - Indonesia
- Bangladesh Power Developement Board
- Georgia Ports Authority, United States
- Globalindo Alam Lestari - Indonesia
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