Bid premium at spot auctions conducted by Coal India Ltd (CIL) remained stable m-o-m in November 2022 after falling for the second consecutive month in September-October. The bid premium was assessed at 241% over the notified price for November, while in October it was 242%. The premiums were 276% in September and 312% in August.
Notably, the bid premium over the notified price in November 2021 was 112%, indicating a surge in bid prices from last year.
CIL offered 5.9 million tonnes (mnt) of coal at spot auctions in November of which almost the entire quantity was booked at INR 2,873 crore.
The coal offering has increased 87% m-o-m in November from 3.15 mnt in October. This increase was primarily due to the return of CIL’s largest coal producing subsidiary, Mahanadi Coalfields Ltd (MCL), into the auction fray after a month’s gap. In fact, except for Central Coalfields Ltd (CCL), all the subsidiaries had come up with an auction during the month.
Subsidiary-wise analysis
South Eastern Coalfields Ltd was the only subsidiary whose offering saw an uptick in the e-spot auction in November against the previous month. The miner’s offering has significant increased to 18.8 mnt against 14.3 mnt in October. This has also resulted in a fall in bid premium, from 275% in October to 225% in November.
On similar lines, Northern Coalfields Ltd and Eastern Coalfields Ltd bid premiums fell by 261% and 232% respectively in November from 311% and 252% in October. Meanwhile, Mahanadi Coalfields Limited’s bid premium fell to 300% in November against 339% in September.
However, Western Coalfields Ltd was the only subsidiary whose bid premium had increased compared to the previous month. The bid premium rose from 145% in October to 193% in November while Bharat Coking Coal Ltd’s bid premium remained range-bound.
Bid premium surges in Apr-Nov’22
CIL’s bid premium in the spot e-auction over the notified price was 308% in April-November 2022. However, the bid premium in the e-spot auction during April-November 2021 was 50%. This surge in the bid premium is the result of curtailing supplies to the non-power sector amid high power demand.
Notably, CIL’s coal sales via e-auctions during April-November, 2021 were at 72.5 mnt against 31 mnt in April-November, 2022.
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