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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, 07 April 20
COAL INDIA'S DISPATCHES DROP, OUTPUT INCREASES - THE HINDU
India’s largest coal producer Coal India Ltd. (CIL) has seen a 10% fall in dispatches in March 2020 due to a sharp fall in demand from the po ...
Tuesday, 07 April 20
CORONAVIRUS AND LOCKDOWNS DRAG DOWN THE INDONESIAN COAL PRICE REFERENCE IN APRIL
COALspot.com: The Ministry of Energy and Mineral Resources of the Republic of Indonesia has revised down the benchmark price of the Indonesian ther ...
Monday, 06 April 20
A 52,000DWT SHIP FIXING DELIVERY SINGAPORE TRIP, VIA INDONESIA, REDELIVERY TAIWAN, AT $3,100 - BALTIC BRIEFING
Capesize
The Capesize market this past week looks to have come off life support and found some improved sentiment. The week began rather ordina ...
Monday, 06 April 20
INDIA'S 21-DAY LOCKDOWN - IMPACT ON COMMODITIES? - WOOD MACKENZIE
India is under a three-week lockdown from 25 March, to contain the spread of the coronavirus outbreak. Wood Mackenzie analysts discuss what this me ...
Friday, 03 April 20
CHINA'S BENCHMARK POWER COAL PRICE DROPS SLIGHTLY - XINHUA
China’s benchmark power coal price dropped slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge ...
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- Energy Development Corp, Philippines
- Kobexindo Tractors - Indoneisa
- Minerals Council of Australia
- Cement Manufacturers Association - India
- GAC Shipping (India) Pvt Ltd
- India Bulls Power Limited - India
- Bangladesh Power Developement Board
- Asmin Koalindo Tuhup - Indonesia
- Vedanta Resources Plc - India
- Siam City Cement PLC, Thailand
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Semirara Mining Corp, Philippines
- Kartika Selabumi Mining - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Goldman Sachs - Singapore
- Holcim Trading Pte Ltd - Singapore
- Eastern Energy - Thailand
- Mercator Lines Limited - India
- Agrawal Coal Company - India
- Coalindo Energy - Indonesia
- Trasteel International SA, Italy
- Global Green Power PLC Corporation, Philippines
- Bhatia International Limited - India
- Merrill Lynch Commodities Europe
- TNB Fuel Sdn Bhd - Malaysia
- Australian Coal Association
- Rio Tinto Coal - Australia
- PNOC Exploration Corporation - Philippines
- London Commodity Brokers - England
- Miang Besar Coal Terminal - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Petron Corporation, Philippines
- Posco Energy - South Korea
- Orica Mining Services - Indonesia
- The State Trading Corporation of India Ltd
- Xindia Steels Limited - India
- CIMB Investment Bank - Malaysia
- Timah Investasi Mineral - Indoneisa
- Riau Bara Harum - Indonesia
- Chettinad Cement Corporation Ltd - India
- Bharathi Cement Corporation - India
- South Luzon Thermal Energy Corporation
- Ministry of Finance - Indonesia
- McConnell Dowell - Australia
- The University of Queensland
- Global Business Power Corporation, Philippines
- PowerSource Philippines DevCo
- Tamil Nadu electricity Board
- Coastal Gujarat Power Limited - India
- Carbofer General Trading SA - India
- Wilmar Investment Holdings
- Mintek Dendrill Indonesia
- Leighton Contractors Pty Ltd - Australia
- Borneo Indobara - Indonesia
- Salva Resources Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Karaikal Port Pvt Ltd - India
- MS Steel International - UAE
- Maharashtra Electricity Regulatory Commission - India
- White Energy Company Limited
- Oldendorff Carriers - Singapore
- Price Waterhouse Coopers - Russia
- Ceylon Electricity Board - Sri Lanka
- Anglo American - United Kingdom
- Indian Oil Corporation Limited
- GMR Energy Limited - India
- AsiaOL BioFuels Corp., Philippines
- TeaM Sual Corporation - Philippines
- Eastern Coal Council - USA
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indika Energy - Indonesia
- Siam City Cement - Thailand
- Romanian Commodities Exchange
- Port Waratah Coal Services - Australia
- Orica Australia Pty. Ltd.
- Directorate Of Revenue Intelligence - India
- Sree Jayajothi Cements Limited - India
- San Jose City I Power Corp, Philippines
- Meenaskhi Energy Private Limited - India
- Banpu Public Company Limited - Thailand
- Tata Chemicals Ltd - India
- Attock Cement Pakistan Limited
- Jindal Steel & Power Ltd - India
- Bhushan Steel Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Manunggal Multi Energi - Indonesia
- Kumho Petrochemical, South Korea
- Krishnapatnam Port Company Ltd. - India
- Heidelberg Cement - Germany
- LBH Netherlands Bv - Netherlands
- GN Power Mariveles Coal Plant, Philippines
- Singapore Mercantile Exchange
- Makarim & Taira - Indonesia
- Indonesian Coal Mining Association
- Pendopo Energi Batubara - Indonesia
- OPG Power Generation Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Georgia Ports Authority, United States
- Kideco Jaya Agung - Indonesia
- Edison Trading Spa - Italy
- Sakthi Sugars Limited - India
- Ind-Barath Power Infra Limited - India
- Independent Power Producers Association of India
- Aditya Birla Group - India
- Vizag Seaport Private Limited - India
- Mercuria Energy - Indonesia
- Bukit Makmur.PT - Indonesia
- Aboitiz Power Corporation - Philippines
- PTC India Limited - India
- ASAPP Information Group - India
- Indo Tambangraya Megah - Indonesia
- Central Electricity Authority - India
- Lanco Infratech Ltd - India
- Uttam Galva Steels Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Bayan Resources Tbk. - Indonesia
- Altura Mining Limited, Indonesia
- Sindya Power Generating Company Private Ltd
- GVK Power & Infra Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Mines - Canada
- Directorate General of MIneral and Coal - Indonesia
- Videocon Industries ltd - India
- Bukit Baiduri Energy - Indonesia
- Larsen & Toubro Limited - India
- Bulk Trading Sa - Switzerland
- Offshore Bulk Terminal Pte Ltd, Singapore
- Renaissance Capital - South Africa
- IEA Clean Coal Centre - UK
- Wood Mackenzie - Singapore
- Deloitte Consulting - India
- Dalmia Cement Bharat India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sojitz Corporation - Japan
- Interocean Group of Companies - India
- Meralco Power Generation, Philippines
- Thai Mozambique Logistica
- Medco Energi Mining Internasional
- Parry Sugars Refinery, India
- Indian Energy Exchange, India
- Gujarat Sidhee Cement - India
- Jaiprakash Power Ventures ltd
- The Treasury - Australian Government
- Power Finance Corporation Ltd., India
- Indogreen Group - Indonesia
- Binh Thuan Hamico - Vietnam
- Baramulti Group, Indonesia
- Kaltim Prima Coal - Indonesia
- Antam Resourcindo - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Planning Commission, India
- Chamber of Mines of South Africa
- Standard Chartered Bank - UAE
- Cigading International Bulk Terminal - Indonesia
- Sical Logistics Limited - India
- IHS Mccloskey Coal Group - USA
- Ambuja Cements Ltd - India
- Formosa Plastics Group - Taiwan
- International Coal Ventures Pvt Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Sinarmas Energy and Mining - Indonesia
- Globalindo Alam Lestari - Indonesia
- Maheswari Brothers Coal Limited - India
- Iligan Light & Power Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Karbindo Abesyapradhi - Indoneisa
- Bukit Asam (Persero) Tbk - Indonesia
- CNBM International Corporation - China
- Metalloyd Limited - United Kingdom
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Essar Steel Hazira Ltd - India
- Malabar Cements Ltd - India
- Grasim Industreis Ltd - India
- Madhucon Powers Ltd - India
- SMC Global Power, Philippines
- Australian Commodity Traders Exchange
- SMG Consultants - Indonesia
- Simpson Spence & Young - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Savvy Resources Ltd - HongKong
- ICICI Bank Limited - India
- VISA Power Limited - India
- Star Paper Mills Limited - India
- Energy Link Ltd, New Zealand
- Mjunction Services Limited - India
- Global Coal Blending Company Limited - Australia
- Ministry of Transport, Egypt
- Sarangani Energy Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Kapuas Tunggal Persada - Indonesia
- Africa Commodities Group - South Africa
- Economic Council, Georgia
- Toyota Tsusho Corporation, Japan
- New Zealand Coal & Carbon
- Electricity Generating Authority of Thailand
- Barasentosa Lestari - Indonesia
- Therma Luzon, Inc, Philippines
- Commonwealth Bank - Australia
- Bhoruka Overseas - Indonesia
- Kepco SPC Power Corporation, Philippines
- Thiess Contractors Indonesia
- European Bulk Services B.V. - Netherlands
- Coal and Oil Company - UAE
- Central Java Power - Indonesia
- Parliament of New Zealand
- Bahari Cakrawala Sebuku - Indonesia
- SN Aboitiz Power Inc, Philippines
- Latin American Coal - Colombia
- Marubeni Corporation - India
- Electricity Authority, New Zealand
- Straits Asia Resources Limited - Singapore
- PetroVietnam Power Coal Import and Supply Company
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