India September Coal Imports Dropped 6.3%, Interocean Data Show

Tue,Oct 25, 2011

Coal imports by India’s power, cement and steel companies fell 6.3 percent in September, the second consecutive monthly drop, according to data from the Interocean Group of Companies.

Adani Enterprises Ltd. (ADE), Bhatia International Ltd., JSW Energy Ltd. (JSW) and other companies imported 9.27 million metric tons of steam and coking coal last month via 28 Indian ports, Interocean, a New Delhi-based ship broker, said in a document obtained by Bloomberg News. That’s down from 9.9 million tons received in August.

Mundra, a port on the west coast, where the Adani group imports most of its coal, received the highest shipments totaling 1.9 million tons. The eastern ports of Paradip, Krishnapatnam and Gangavaram received 927,213 tons, 723,422 tons and 624,837 tons of the commodity, respectively, Interocean data showed. Visakhapatnam, also in the east, received 615,225 tons.

Most imports came from Indonesia, Australia and South Africa, according to the document.

(sourced Bloomberg)

Indian coal imports up by 8pct MoM in July - Report

Sunday, 14 Aug 2011

According to data from Interocean Group of Companies, Indian companies led by Adani Enterprises Limited, Bhatia International Limited and JSW Energy Limited increased coal imports by 8% MoM in July 2011 from a month earlier.

The New Delhi based ship broker said that power, steel, cement and paper producers purchased 10.8 million tonnes of steam and coking coal last month via 30 Indian ports.

Mr Sriprakash Jaiswal coal minister said that India's domestic coal production may fall short of demand by 142 million tonnes in the financial year ending March 2012. The nation produces 530 million tonnes of coal a year and imports about 67 million tonnes.

Interocean data showed that Paradip port on the east coast received the most coal shipments in July 2011, totaling 1.52 million tonnes. Visakhapatnam, Gangavaram and Krishnapatnam, all on the east coast, received 978,221 tonnes, 877,882 tonnes and 755,438 tonnes of the fuel, respectively.

The monsoon from June to September 2011 can slow coal imports on the west coast and divert shipments to ports in the east.

Most imports came from Indonesia, Australia and South Africa. State-owned Steel Authority of India Limited bought two shipments while Rashtriya Ispat Nigam Limited and Shree Cement Limited received one shipment each from the US.

(sourced Bloomberg)

INDIA IMPORTS 36.033 MILLION TONS OF INDONESIAN COAL TILL JUNE

Indonesia shipped 28.27 Million tons of coal in June 2011, a 2.3 percent lesser than May export of about 28.962 million tons, Indonesian coal industry sources said.

Indonesian coal producers have shipped approximately 8.236 million tons of coal to China in June, which was 0.24 percent higher than May 2011 exports. However, Indonesian producers failed to push more coal to India in June.

Indian importers have imported 2.63 percent lesser coal compared to May Imports. India has imported only around 6.20 million tons, which were around 21.95 percent of Indoneisan total coal exports in June. In the meantime, India has imported approximately 36.033 million tons coal, which was slightly lesser than Chinese's imports of 36.071 million tons, during first half this year.

India was the largest Indonesian coal importer since January 2011 until April 2011, until China becomes the largest importer of Indonesian coal since May 2011.

According to the coal minister of India, India's coal imports may be at 250 million tons per annum by 2016. Coal imports are an unavoidable options for Indian utilities due to non availability of economically viable coal from domestic mines. However, according to Indian UMPPs, due to Indonesian government regulation that forces all coal producers must sell coal at government declared monthly prices, would cost them at least US$ 30 per ton higher than they previously budgeted.

According to Indian power industry sources opined that Indian UMPPs ( ultra-mega power project) suddenly caught in between as the concept of UMPP was implemented 4 to 5 years back. The large scale industrial houses in India have bided and secured UMPP licenses based on the open market prices /long term coal contracts from Indonesian producers (I.e., pre regulated Indonesian market). Now that Indonesian coal reference price mechanism is in place all the UMPP's are seeking Indian government’s assistance in revising the Power Tariff of UMPP.

There are mixed of reactions from Indian mine investors in Indonesia related to government regualtion on coal referance price. Indian power plants are must focus on the fuel security than price advantages out of Indonesian coal mine operations. Mine investments in Indonesia will definitely a good option for power producers of India to secure fuel for their plants, according to an Indian power producer who had invested coal mine in Indonesia.

Meantime, another investor opined that, more and more of Indian lenders are concerned with the sourcing of coal from Indonesia for their power generating plants after reported backing out of Reliance Power from their proposed 4000 MW UMMP in Krishnapatnam port zone due to higher cost for coal imports from Indonesia.

Indonesia has introduced bench mark pricing mechanism for its coal since February 2010, and it has implemented for the domestic supplies as well the export market. The pricing was done on the transparent way using four internationally acceptable coal indices to generate monthly Indonesian coal reference prices for about 62 types of coal, including 8 types of bench mark qualities.

The regulation also requires miners to report sales volumes, prices, and buyers every month to the government, allowing it to ensure that the rules are being followed. Violations can lead to revocation of mining permits. The price benchmark aims to prevent firms selling coal to affiliates at low prices to avoid taxes that hurts Indonesia's efforts to collect revenues from its massive commodity exports.

Ministry of Energy and Mineral Resources of Indonesia has set the July 2011 Indonesian Coal Reference Price for thermal coal at US$ 118.24 per ton per ton, which was 0.66 percent lesser than June 2011 price. Assessment basis of coal price reference was calculated considering coal with GCV (GAR) 6,322 kcal/kg, Total Moisture (arb) 8.00%, Total Sulphur (arb) 0.8%, Ash Content (arb) 15.00% and delivery free on Board (FOB) Vessel basis and applicable for spot contract, delivery between 1 – 31 July 2011.

Indonesian government is currently drafting a new regulation that could ban the export of low-grade coal by January 12, 2014. This is likely to apply to coal below 5100 kilocalories (on air dried basis) in value.

Indonesian large-scale producers were offering bituminous coal of 5,500 kcal/kg NAR at around $ 108 a ton, FOB vessel basis, and the price was almost flat since last week, buyers said.

79.77 percent of total coal exports in June shipped to China, India, South Korea, Japan and Taiwan respectively.

ndia Coal Imports May Fall

JANUARY 20, 2011

NEW DELHI -- India's coal imports may fall this financial year after extreme weather conditions in main producing countries pushed up global prices, Coal Minister Sriprakash Jaiswal said Thursday.

International coal prices have surged in recent months because of heavy floods in Australia's Queensland region that have disrupted mining activities at a time when demand from Asian importers such as China and India remains strong. India imported 44.28 million tons of thermal coal and 23.46 million tons of coking coal in the last financial year that ended March 31, 2010.

JANUARY 20, 2011

The South Asian nation is likely to face a shortage of 83 million tons this financial year as local output of 573.42 million tons lags demand of 656.31 million tons. Lower-than-estimated imports could hurt electricity generation while surging prices may hurt earnings at cement, power and steel companies.

The power ministry had fixed an import target of 35 million tons of coal this financial year. The utilities imported 16.12 million tons until December-end, the Central Electricity Authority's website showed.

The agency said generation at coal-based power plants rose 3% from a year earlier in the April-December period to 387.91 gigawatt-hours, but missed the government's target of 406.51 gigawatt-hours mainly due to coal shortages.

According to the globalCoal website, the price of thermal coal rose to $136.30 a ton at Australia's Newcastle port for the week ending Jan. 14, from $129.90 a ton the previous week.

Mumbai-based Kotak Securities Ltd. said in a Jan. 11 note that the price of Australian coking coal has surged 32% year-on-year to $230 a ton.

Australia supplies two-thirds of the global market in the premium hard coking coal used in blast furnaces, and the Newcastle port is the world's biggest thermal coal export terminal.

Minister Jaiswal also said the ministry may consider raising domestic coal prices after July.

"Coal India Ltd. is due to finalize its next wage revision by then. So the quantum of the rise will be dependent on the burden of the wage revision on the company," he said.

State-run Coal India, which accounts for more than four-fifths of local production, is free to fix coal prices but in consultation with the government.

sourced:The Wall street Journal, by Saurabh Chaturvedi & Rakesh Sharma