India’s thermal power plants are shying away from coal imports in view of the ample availability of domestic supplies that has helped them to further scale up inventory levels.
As per provisional data furnished by the power ministry, coal imports by thermal power plants dropped 30% m-o-m to 3.17 million tonnes (mnt) in November 2022, registering a decline for the fourth straight month.
However, imports jumped nearly 2-fold y-o-y against 1.59 mnt in November 2021.
Demand for imported coal has witnessed a drastic shift during the fiscal. Earlier in summer, higher imports were necessitated in tandem with government mandate to address domestic scarcity. However, post monsoon, the power plants curtailed procurement of imported coal at a time power consumption gradually eased.
In November, domestic coal supplies to the plants jumped to a 5-month high of 60.6 mnt, which played a major part in mitigating imports. Besides, it also helped the plants to accumulate 30.93 mnt of inventory at end of November, which was 56% higher than the year-ago level.
Plant-wise import summary
Lower imported coal procurement was seen both from plants designed to run on domestic as well as imported coal. Nevertheless, plants based on domestic coal again recorded higher imports than the ones running on imported coal in November, which is opposite of the usual trend.
Source: Power Ministry | Quantity in mnt
It is important to note that imported coal-based (ICB) plants were set up at coastal regions as it helps them save the logistics costs instead of procuring indigenous supplies from far away domestic mines.
However, operational hurdles faced by the ICB plants amid soaring prices limited their coal procurement.
Coal imports by the domestic coal-based plants recorded an exponential growth of 375% y-o-y at 27.22 mnt during April-November. On the other hand, imports by the ICB plants were assessed almost stable at 14.8 mnt in April-November as against 14 mnt in April-November, 2021.
In fact, out of the 15 ICB plants, nil imports was recorded from five in November 2022.
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