According to the latest updates, India seems to have enough stock of thermal coal required by power plants for electricity generation. A CEA (Central Electricity Authority) official has mentioned that at present India has thermal coal stock for 23 days, a day more than 22-days fuel stock required as per the CEA mandate.
On 11 Mar’20, country’s coal stock supplied by CIL for power plants stood at around 39.5 MnT which is sufficient for 23 days and is likely to increase further in the remaining days of the ongoing fiscal which is ending in March’ 2020. CIL supplies thermal coal to about 125 power plants out of the total of 134 power plants in India. The average daily consumption of thermal coal by power plants at present stands to be around 1.76 MnT.
India’s largest coal supplier, CIL is ramping up its thermal coal production in an effort to meet its annual coal production target of 660 MnT. Last month i.e. in Feb’20, CIL produced 66.3 MnT of thermal coal, up by 5% m-o-m basis and by 14% y-o-y basis.
Apart from increased production from CIL, India’s dependency on coal imports seems to have been reduced in past two months amid the Coronavirus outbreak which has also led to increase in non-coking price volatility. The country’s Feb’20 coal imports stood at 17.01 MnT against 19.8 MnT in Feb’19. Of the total imports in February 2020, non-coking coal was at 12.25 MnT and coking coal imports were at 3.15 MnT.
Indian government is trying hard to curb coal imports and has asked states to stop thermal coal imports and use domestic coal on a priority basis. With this agenda, it is likely that CIL will continue to ramp up its production in the coming months of summer season and despite reluctance for import bookings amid COVID scare globally, power plants may continue to have sufficient coal stocks that will suffice in the upcoming months (before rainy season starts) which requires highest electricity generation.
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