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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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Friday, 24 April 20
CHINA COAL PRODUCER YANZHOU COAL POSTS 9.6 PCT RISE IN 2019 NET PROFIT - XINHUA
China’s major coal producer Yanzhou Coal Mining Co., Ltd. said Thursday that its net profit saw a 9.6 percent rise in 2019.
Th ...
Tuesday, 21 April 20
INDONESIA ACCOUNTS FOR 19% OF JAPAN'S TOTAL COAL IMPORTS - BANCHERO COSTA
Coal trade in Asia is proving remarkably resilient this year, despite the global economic impact from COVID-19.
We have seen China&r ...
Tuesday, 21 April 20
COVID-19: CHARTERPARTY MATTERS FOR SHIPOWNERS - SKULD
KNOWLEDGE TO ELEVATE
Whilst the plight of cruise ships, stranded off shore with sick passengers and crew, may be dominating media headlines, t ...
Monday, 20 April 20
SUPRAMAX: A 52,000DWT SHIP FIXING AN INDONESIA COAL RUN TO CHINA AT $4400 - BALTIC BRIEFING
Capesize
This week was the strongest period seen for the Capesize market in several months. All routes globally succumbed to improved sentiment ...
Friday, 17 April 20
PANDEMIC TO BRING ASIA'S 2020 GROWTH TO HALT FOR 1ST TIME IN 60 YEARS - IMF: REUTERS
Asia’s economic growth this year will grind to a halt for the first time in 60 years, as the coronavirus crisis takes an “unprecedented ...
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- Maharashtra Electricity Regulatory Commission - India
- Tata Chemicals Ltd - India
- Maheswari Brothers Coal Limited - India
- Rashtriya Ispat Nigam Limited - India
- Kartika Selabumi Mining - Indonesia
- Formosa Plastics Group - Taiwan
- Directorate General of MIneral and Coal - Indonesia
- Posco Energy - South Korea
- Kalimantan Lumbung Energi - Indonesia
- Samtan Co., Ltd - South Korea
- Gujarat Sidhee Cement - India
- Tamil Nadu electricity Board
- Salva Resources Pvt Ltd - India
- Petron Corporation, Philippines
- Essar Steel Hazira Ltd - India
- Carbofer General Trading SA - India
- Asmin Koalindo Tuhup - Indonesia
- Bhoruka Overseas - Indonesia
- Australian Commodity Traders Exchange
- Sojitz Corporation - Japan
- Bahari Cakrawala Sebuku - Indonesia
- Agrawal Coal Company - India
- Indogreen Group - Indonesia
- Altura Mining Limited, Indonesia
- Interocean Group of Companies - India
- Toyota Tsusho Corporation, Japan
- Pipit Mutiara Jaya. PT, Indonesia
- CNBM International Corporation - China
- Lanco Infratech Ltd - India
- Mjunction Services Limited - India
- Barasentosa Lestari - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Sindya Power Generating Company Private Ltd
- Oldendorff Carriers - Singapore
- Sinarmas Energy and Mining - Indonesia
- Independent Power Producers Association of India
- Cement Manufacturers Association - India
- GMR Energy Limited - India
- Indonesian Coal Mining Association
- Global Business Power Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Ministry of Finance - Indonesia
- Bukit Baiduri Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- Mintek Dendrill Indonesia
- Malabar Cements Ltd - India
- Metalloyd Limited - United Kingdom
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Karbindo Abesyapradhi - Indoneisa
- Heidelberg Cement - Germany
- Indika Energy - Indonesia
- The University of Queensland
- Latin American Coal - Colombia
- Africa Commodities Group - South Africa
- Commonwealth Bank - Australia
- Therma Luzon, Inc, Philippines
- MS Steel International - UAE
- PetroVietnam Power Coal Import and Supply Company
- LBH Netherlands Bv - Netherlands
- Mercator Lines Limited - India
- Renaissance Capital - South Africa
- Rio Tinto Coal - Australia
- Parry Sugars Refinery, India
- Banpu Public Company Limited - Thailand
- Globalindo Alam Lestari - Indonesia
- Iligan Light & Power Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Central Java Power - Indonesia
- GAC Shipping (India) Pvt Ltd
- SN Aboitiz Power Inc, Philippines
- India Bulls Power Limited - India
- Simpson Spence & Young - Indonesia
- Standard Chartered Bank - UAE
- Star Paper Mills Limited - India
- Mercuria Energy - Indonesia
- London Commodity Brokers - England
- Romanian Commodities Exchange
- Electricity Generating Authority of Thailand
- Kobexindo Tractors - Indoneisa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Electricity Authority, New Zealand
- Medco Energi Mining Internasional
- PTC India Limited - India
- Baramulti Group, Indonesia
- PowerSource Philippines DevCo
- Cigading International Bulk Terminal - Indonesia
- Semirara Mining Corp, Philippines
- Coal and Oil Company - UAE
- SMG Consultants - Indonesia
- Power Finance Corporation Ltd., India
- Bukit Makmur.PT - Indonesia
- Karaikal Port Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Central Electricity Authority - India
- Wilmar Investment Holdings
- Jorong Barutama Greston.PT - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- McConnell Dowell - Australia
- Thai Mozambique Logistica
- Port Waratah Coal Services - Australia
- Sree Jayajothi Cements Limited - India
- Dalmia Cement Bharat India
- Billiton Holdings Pty Ltd - Australia
- Alfred C Toepfer International GmbH - Germany
- Attock Cement Pakistan Limited
- Thiess Contractors Indonesia
- Chettinad Cement Corporation Ltd - India
- Ind-Barath Power Infra Limited - India
- Australian Coal Association
- Petrochimia International Co. Ltd.- Taiwan
- Binh Thuan Hamico - Vietnam
- Planning Commission, India
- Intertek Mineral Services - Indonesia
- TeaM Sual Corporation - Philippines
- Coastal Gujarat Power Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- ASAPP Information Group - India
- Eastern Coal Council - USA
- Price Waterhouse Coopers - Russia
- Bulk Trading Sa - Switzerland
- Sakthi Sugars Limited - India
- GVK Power & Infra Limited - India
- Indian Oil Corporation Limited
- Wood Mackenzie - Singapore
- Orica Mining Services - Indonesia
- Aboitiz Power Corporation - Philippines
- Timah Investasi Mineral - Indoneisa
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- CIMB Investment Bank - Malaysia
- Manunggal Multi Energi - Indonesia
- Goldman Sachs - Singapore
- Gujarat Electricity Regulatory Commission - India
- Xindia Steels Limited - India
- The State Trading Corporation of India Ltd
- Siam City Cement PLC, Thailand
- Ministry of Transport, Egypt
- Sarangani Energy Corporation, Philippines
- Edison Trading Spa - Italy
- Trasteel International SA, Italy
- Riau Bara Harum - Indonesia
- Indian Energy Exchange, India
- Krishnapatnam Port Company Ltd. - India
- Leighton Contractors Pty Ltd - Australia
- Anglo American - United Kingdom
- Makarim & Taira - Indonesia
- Eastern Energy - Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Global Coal Blending Company Limited - Australia
- Neyveli Lignite Corporation Ltd, - India
- White Energy Company Limited
- Jaiprakash Power Ventures ltd
- Deloitte Consulting - India
- Orica Australia Pty. Ltd.
- Uttam Galva Steels Limited - India
- International Coal Ventures Pvt Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- IHS Mccloskey Coal Group - USA
- Savvy Resources Ltd - HongKong
- ICICI Bank Limited - India
- Videocon Industries ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Bhushan Steel Limited - India
- Minerals Council of Australia
- Aditya Birla Group - India
- IEA Clean Coal Centre - UK
- Sical Logistics Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- SMC Global Power, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Meralco Power Generation, Philippines
- Georgia Ports Authority, United States
- Jindal Steel & Power Ltd - India
- Kumho Petrochemical, South Korea
- Holcim Trading Pte Ltd - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Economic Council, Georgia
- Kaltim Prima Coal - Indonesia
- Indo Tambangraya Megah - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Marubeni Corporation - India
- Siam City Cement - Thailand
- Parliament of New Zealand
- Global Green Power PLC Corporation, Philippines
- Borneo Indobara - Indonesia
- Singapore Mercantile Exchange
- VISA Power Limited - India
- San Jose City I Power Corp, Philippines
- Ambuja Cements Ltd - India
- Merrill Lynch Commodities Europe
- Bangladesh Power Developement Board
- Madhucon Powers Ltd - India
- Bharathi Cement Corporation - India
- Energy Development Corp, Philippines
- Meenaskhi Energy Private Limited - India
- Chamber of Mines of South Africa
- Coalindo Energy - Indonesia
- Antam Resourcindo - Indonesia
- The Treasury - Australian Government
- AsiaOL BioFuels Corp., Philippines
- Bayan Resources Tbk. - Indonesia
- European Bulk Services B.V. - Netherlands
- Bhatia International Limited - India
- PNOC Exploration Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Ministry of Mines - Canada
- Vedanta Resources Plc - India
- Larsen & Toubro Limited - India
- Kepco SPC Power Corporation, Philippines
- Energy Link Ltd, New Zealand
- Grasim Industreis Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Vizag Seaport Private Limited - India
- Gujarat Mineral Development Corp Ltd - India
- New Zealand Coal & Carbon
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