Thermal coal vessel arrivals at Indian ports have dropped by 23% m-o-m in the first half of January 2023 (1-15 January) to 4.22 million tonnes (mnt), CoalMint’s vessel line-up data showed. The drop has come amid reduced demand from its biggest imported coal consumers – power and sponge iron sectors. This is mainly because of improved domestic coal supplies for Indian power sector and limited sponge iron demand.
India’s domestic coal production in the calendar year 2022 (CY’22) stood at 861.9 mnt, up by 12% y-o-y. In the last quarter of CY’22 (Oct-Dec’22), production went up by 27% q-o-q and 9% y-o-y.
Indonesian coal accounts for highest share
Out of the total imports in the first half of January, volumes of Indonesian coal were the highest at 1.75 mnt. Major trading companies that brought in Indonesian coal were Adani Enterprises at 0.4 mnt and Agrawal Coal at 0.2 mnt. About 1.33 mnt is expected to be imported in the second half of the month from Indonesia.
Indonesian coal importers in 1-15 January
Qty in mnt
Shipments from South Africa pick up
Shipments from South Africa were recorded at 0.82 mnt in the period under review, up slightly against 0.79 mnt in the same period in December. The Feegrade stood as the largest importer at 0.16 mnt.
India has started importing more 4800 NAR grade coal, as 5500 NAR grade is quite expensive. About 0.27 mnt of thermal coal is expected to be shipped in the second half of the month from South Africa.
South African coal importers in 1-15 January
Qty in mnt
Other exporting countries
India’s imports of Australian coal were recorded at 0.78 mnt being brought in by major trading companies such as Mahendra Strips and Adani Enterprises. However, the volumes were higher m-o-m compared to 0.49 mnt seen over 1-15 December, 2022. About 1.08 mnt of Australian coal is expected to arrive at Indian ports in the second half of January.
Shipments from Russia dropped to 0.33 mnt in the period under review as compared to 0.63 mnt in the first half of December.
Shipments from the US also decreased m-o-m to 0.25 mnt compared with 0.38 mnt in the same period in the previous month.
Outlook
Thermal coal imports are expected to rise in the short-term as increasing power demand has compelled the government to reconsider its stance towards imported coal procurement. In a new directive issued in January 2023, the Ministry of Power (MoP) has instructed power plants to resort to imported coal procurement for 6% (by weight) of their needs for blending with domestic coal till September 2023, failing which curtailment in domestic supply has been proposed.
However, any significant rise in imports seems unlikely as domestic production is likely to increase in the upcoming months as the government intents to meet its coal production target of 900 mnt for FY’23 (ending in March 2023).
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