Coal India Ltd (CIL) has again missed its production target for FY20 which was quite ascertain, however, despite posting a steep recovery of late, the miner could not prevent its output level falling Y-o-Y, an unlikely performance that was not seen in recent times.
CIL’s cumulative coal output managed to breach the 600 MnT like it did in the previous fiscal, which was supported by a combined efforts from its subsidiaries. Incidentally, the miner had registered 3.851 MnT output on 30 Mar’20 to clock its highest ever single day production.
Nevertheless, the total output of 602.11 MnT attained in FY20, was approx. 58 MnT short of the MoU target of 660 MnT, while it had also noted modest decline Y-o-Y from 606.89 MnT in FY19.
It was CIL’s first output decline since 1998-99, when production fell by 1.7% on the year to 256.49 MnT.
Despite the short-coming, the year capped off a remarkable performance from its subsidiaries helping it to attain highest monthly production of 84.36 MnT in Mar’20, which came against the concerns regarding COVID-19.
However, in the end the production loss suffered due to extensive rains proved too much for CIL to overcome the deficit.
Subsidiary-wise Coal Production:
SECL cemented its position as the largest coal producing subsidiary with an output of 150.55 MnT, as it crossed the 150 MnT mark for the second year in a row. During FY20, SECL’s Gevra mining area which was severely affected by the heavy rains, had attained its highest annual production of 45 MnT.
MCL was the second-largest coal producer with output of 140.36 MnT in FY20.
These two were the highest contributor in total output, but had also missed their respective target by a margin in excess of 19 MnT.
WCL and NCL were the only subsidiaries which had attained their respective targets during the fiscal, with the former raking the highest growth rate in annual production among the 8 subsidiaries.
ECL was the third subsidiary (after WCL and NCL), which had posted a Y-o-Y growth in coal production.
CIL’s Coal Off-take:
CIL’s coal dispatch decreased 26% Y-o-Y to 581.73 MnT in FY20, on account of subdued demand from power sector. Dispatch in the fiscal ending month of March was marked at 53.45 MnT.
Incidentally, in a period where the miner had made relentless effort to elevate the output by managing 2.72 MnT coal/day in Mar’20, the dispatch level was only accessed at 1.72 MnT/day during the month.
Out of the 8 subsidiaries, only NCL had managed to attain its annual dispatch target, which had also noted a Y-o-Y growth from previous year.
As a consequence of higher production than dispatch, coal stock at CIL’s pit-head mines has surged 38% Y-o-Y to 74.56 MnT at the end of FY20. It is likely that the miner would lower the production level in the beginning of the upcoming fiscal and raise the frequency of e-auctions, in order to liquidate the excess stock.
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