India’s total coal imports (excluding pet coke) over Jan-Oct’21 rose a modest 4% to 183 million tonnes (mn t) against 175 mn t seen in the same period in CY’20, as per data maintained with SteelMint .
In Oct’21, total imports (excluding pet coke) touched 17.22 mn t, up a nominal 3% y-o-y against 16.78 mn t in Oct’20 while m-o-m volumes rose 20% compared to 14.37 mn t in Sept’21.
Overall, imports rose nominally because of the coal inflation that impacted end-user plants across power, sponge iron, cement, steel etc.
Thermal coal
Within the total corpus, India’s thermal coal imports rose 16% m-o-m to 10.8 mn t in Oct’21 but dropped y-o-y 36% against 16.81 mn t in Oct’20.
Over Jan-Oct’21, imports dipped 4% to 122 mn t against 127 mn t seen in Jan-Oct’20
Imports rose m-o-m because of the acute domestic supply shortage last month, despite a volatile global thermal coal market where prices reached multi-year highs, before correcting towards October-end.
As per CoalMint’s vessel line-up data, imports from Australia and South Africa m-o-m were the highest at 2 mn t each, up 108% and 35% respectively. Imports from Indonesia, however, fell slightly by 8% m-o-m to 5.4 mn t in Oct’21.
Interestingly, old Australian cargoes of 0.50 mn t, lying at Chinese ports, made their way to India in October being comparatively cheaper against fresh cargoes.
Meanwhile, after struggling to meet supply targets over the last few months, Coal India’s production rose a sharp 23% m-o-m to 50 mn t in Oct’21, while its dispatches were at 57 mn t, up 17% m-o-m.
Coking coal
India’s coking coal imports increased 3% m-o-m to 4.34 mn t in Oct’21, as against 4.22 mn t in Sep’21, data reveals. Over Jan-Oct’21, import volumes were at 57.31 mn t, up 42% against 40.30 mn t seen in the same period last year.
Pulverised coal injection (PCI) import shipments increased by over 82% m-o-m to 1.13 mn t in Oct’21, as against 0.62 mn t in Sept’21.
Imports from Australia remained almost stable at 3.37 mn t in Oct’21 while those from Canada, China, Indonesia and Russia surged last month. Shipments from Mozambique and USA fell in considerable volumes m-o-m in October.
Global thermal coal prices fluctuate
After rising sharply to cross the $250/tonne (t)-mark for high-calorific value (CV) coal in mid-October, global thermal coal prices started climbing down, corrected 10% by month-end following the Chinese government’s intervention to stabilise domestic coal prices there.
In coking coal, the Indian market has been lately observing a considerable decrease in enquiries for seaborne coking coal while prices have shown a slight downward movement, while spot transactions were relatively limited other than in existing long-term contracts.
Indian steel mills, despite having ramped up capacity utilisation sharply since the second wave of the pandemic receded, have largely consumed existing inventories and mostly refrained from fresh seaborne procurements amid escalated Australian prices.
Outlook
Thermal coal imports are likely to remain supported in the coming months due to the recent drop in global prices. There are expectations that prices may stabilise. However, any sharp rise in imports is unlikely due to India’s improving domestic coal supply scenario.
In coking coal, import demand would pick up soon on restocking needs from the primary mills which have been operating at optimum blast furnace capacity levels in recent months. However, full-scale revival in spot purchases may take a while since prices are expected to remain firm because of the approaching wet season in Australia which will impact supply.
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