Pakistan’s thermal coal imports fell for the third month in a row to 1.1 million tonnes (mn t) in Oct’21, down 23% m-o-m amid volatile international thermal coal prices, CoalMint’s vessel-line up data reveals.
The country’s coal imports from South Africa were recorded at 0.6 mn t, down 29% m-o-m, while imports from Indonesia were recorded at 0.17 mn t, down 28% m-o-m.
After rising significantly till mid-October, Chinese domestic coal futures fell by 52% towards the month-end on 19 October as the Chinese government intervened to stabilise prices. Subsequently, imported coal prices of South African, Australian, and Indonesian origin also followed suit.
Indonesian high CV (5800 GAR) coal prices moved down by 7% from their peak of $216.6/t in mid-October to $202.4/t as on 29 Oct’21. South African coal prices also corrected by 32% from their peak in October to $165/t. Australian 5500 NAR coal prices also fell 10% m-o-m to $135/t in Oct’21.
Rising power demand, commodity prices
Pakistan’s power generation remained weak in October due to the sharp rise in coal prices. As per data from Pakistan’s National Electric Power Regulatory Authority (NEPRA), power generation in the country fell 13% m-o-m to 14,032 gigawatt hours in Sept’21. However, on a y-o-y these rose by 7.1%.
The decline in power generation came as fuel costs for power generation increased by 65% y-o-y to PKR 6.80/KWh mainly due to rise in furnace oil, coal, and natural gas prices.
NEPRA, last week, allowed the federal government to increase the base power tariff from this month (November).
The increase in power tariffs is seen as further weighing down the country’s power demand in the short-term.
Sales of cement sector remains range-bound
Pakistan’s cement sector, key user of thermal coal, recorded a 13% m-o-m rise in sales to 5.2 mn t in Oct’21. However, sales fell 9% on a y-o-y basis, as per data from the All-Pakistan Cement Manufacturers Association.
In the first four months of the financial year (July-October), total cement dispatches (domestic sales and exports) amounted to 18 mn t, lower by 7% y-o-y.
Any potential sharp rise in cement sales last month was capped amid persistent rise in input costs coupled with recent devaluation of Pakistan’s rupee against the dollar.
Imports from Mozambique rise sharply
Pakistan’s thermal coal imports from Mozambique rose to 0.30 mn t, up 166% m-o-m, while that from USA and Russia were nil last month.
The country’s coal imports from Australia fell 46% m-o-m to 0.07 mn t last month.
Outlook
Pakistan’s coal imports may see a rise in November m-o-m amid a fall in imported coal prices.
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