Domestic coal prices in the resellers’ market have witnessed a varied trend this week. Coal prices in Wani, Maharashtra remained unchanged amid improvements in demand and supply. But, prices in Bilaspur, Chhattisgarh saw a steep fall of 9%, triggered by low demand.
Last week, prices both in Bilaspur and Wani were unchanged.
Wani: Prices stable amid demand supply equilibrium
Prices for 4,500 GCV coal in Wani, Maharashtra, remained unchanged w-o-w at INR 10,000 per tonne ex-Wani on December 9, 2022, CoalMint data shows.
On the demand side, market participants informed CoalMint that there has been an increase in coal demand as compared to the last few weeks. This increase is mainly driven by procurement by brick manufacturers. However, demand from the industrial and agro-industrial sectors remained almost stable.
A trader informed CoalMint: “At present, coal inquiries are the highest since October–November.” He further added: “We are expecting more inquiries from Gujarat as the elections are over there. Many market participants that were engaged in the election process are now free. In addition, removal of election-related restriction will improve trade.”
On the supply side, there has been no shortage as the traders have started receiving supplies against the last auction.
Bilaspur: Low demand weigh on prices
Prices of 5,000 GCV coal in Bilaspur stood at INR 9,600/t exw, a drop of INR 900/t w-o-w as per CoalMint’s assessment. Traders could not hold on to prices this week because there is no improvement in demand. Additionally, since bid prices dropped in the latest auction, traders were under pressure to lower their offers.
“Supply of lower-priced coal from fresh auctions is very limited, but due to lack of demand, we are lowering the prices,” a trader from Bilaspur told CoalMint.
Meanwhile, end-users are in “wait-and-watch” mode, only procuring limited quantities as they are hopeful of a fall in prices in the near term.
However, some traders confirmed that inquiries have increased from brick manufacturers in Uttar Pradesh and Madhya Pradesh.
Outlook
In the near term, prices are expected to fall marginally or remain stable. However, there is lesser chance of a price hike.
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