Coal India Ltd (CIL) has concluded a special forward auction after a gap of one month with its subsidiary company NCL carrying out the sale on 11 Sep ’20.
It is pertinent to note that power plants spilling with excess coal inventories have turned a deaf ear to these auctions. During the first four months of FY ’21 (Apr-Jul ’20), CIL had put 45.64 mn t coal on sale under special forward auctions envisaged specifically for power producers, out of which only 7.94 mn t coal was booked.
Consequently, bulk of coal was offered to non-power sector via exclusive and spot auctions, whereas no special forward auction was reported during Aug ’20.
Coal allocation in NCL’s auction:
The company had floated 3,505,760 t coal in the auction, out of which over half of the quantity accounting to 1,869,880 t was sold. The allocated quantity recorded an exponential growth of 190% from 644,000 t coal booked in the previous round of auction held in Jun ’20.
However, there was no considerable progress seen in terms of bids received for the coal volume, as apart from premium of INR 351/t fetched against rail mode sale of G10 grade from Jayant colliery, rest of the lot was sold at the reserve price. (Detailed colliery-wise result can be seen here).
Incidentally, entire volume via road and rail sale from Jayant colliery along with that from Block-B colliery was lifted. In contrast, no bids were noted for coal offered from Jhingurdah and Amlohri collieries.
Decline in inventories at power plants is likely to boost domestic coal sales, but given the sluggish power demand, CIL has maintained a muted response with two of its major coal producing subsidiaries yet to offer coal under special forward scheme of auction.
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