Friday, October 15,
Coal India Ltd, the world’s largest coal producer, is not likely to revise its present coal prices till July 2011, which could mean a significant relief to coal consumers, including major power and steel producers
.
With the next wage revision at CIL due by July 2011, the company may have to revise prices of the raw material at that time by 10 to 15 per cent to partially offset the cash outflow arising out of the wage revision.
“While we will not look to increase (coal) prices immediately, we may have to revise the prices after the wage revision slated before July 2011. The hike this time could be below the earlier 15 per cent, but it would depend on the quantum of wage increase that we conclude,” said, Mr T.K. Laheri, Chairman and Managing Director of Bharat Coking Coal Ltd, one of the eight subsidiaries of CIL.
CIL does not see the need for frequent revision of coal prices, with its present pricing mechanism involving long-term price contracts, some exceeding even 28 months.
In the long run, the company plans to increase production of value-added products like washed coal, with plans to set up 20 washeries in the next five years.
Infusion of new technologies and digging deeper than the present level of 300 metres for underground mining are other measures being taken to hold coal price levels.
Source: The Business Line
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