SECL’s Current auction prices fetch comparatively low bids of INR 200-300/MT, influenced by constantly falling global coal prices.
SECL, the largest subsidiary of Coal India, recently conducted an e-auction on 20 & 21 Apr’15 to offer 1.4 MnT domestic Coal. The auction saw comparatively low bids by participants which declined up to INR 300/MT, because they are not ready to pay high for domestic material since imported material is already being offered at comparatively low prices.
In this auction companies like Jindal Power, Korba West Power, Hindalco Industries, Bharat Aluminium, JSPL, Prakash Industries and Godawari Power participated very aggressively and emerged as bidders for the largest quantities.
A participant in the auction highlighted, “Recent auction prices have fallen by around INR 300/MT compared to the previous auction prices. Domestic prices have declined on the ground of continuous falling global coal prices.”
Jindal Power received about 196,900 MT total quantity of size G12 (3700-4000 GCV) ROM coal at an average price of INR 1,521/MT. The company had bid for different mines, namely, Baroud OC, Jampali OC and Chhal OC with base price of INR 1068/MT. Meanwhile, Bharat Aluminum received total material from Gevra OC(stock) and Manikpur OC (stock) mines with winning price at INR 1,328/MT (128,500 MT) for size G11 ROM coal (4000-4300 GCV) and at INR 1,221/MT(63,500 MT) for size G12 ROM coal respectively.
Hindalco Industries’ bid price was about INR 1,598/MT for size G12 ROM coal from Chhal OC. The company received 50,000 MT Coal at its winning price which is higher by INR 500/MT as compared to the floor price set by SECL.
| Bidder Name | Colliery | Grade | Qty in MT | Floor price | Bid Price | Sector |
| Jindal Power | Baroud OC | G12 Sized ROM (-100 mm) | 106,000 | 1,068 | 1,608 | Power |
| Jindal Power | Jampali OC | G12 Sized ROM | 70,000 | 1,068 | 1,368 | Power |
| Korba West Power | Baroud OC | G12 Sized ROM (-100 mm) | 50,000 | 1,068 | 1,638 | Power |
| Hindalco Industries | Chhal OC | G12 Sized ROM (-100 mm) | 50,000 | 1,068 | 1,598 | Aluminium |
| BALCO | Gevra OC(Stock) | G11 Sized ROM | 43,000 | 1,140 | 1,310 | Aluminium |
| JSPL | Baroud OC | G8 Sized ROM (-100 mm) | 37,000 | 2,028 | 2,498 | Sponge Iron |
| Godawari Power & Ispat | Gevra OC(Stock) | G11 Sized ROM | 32,500 | 1,140 | 1,310 | Captive Power |
| Hindalco Industries | Kurja UG (Bunker) | G4 Sized ROM | 14,400 | 3,490 | 3,490 | Aluminium |
| Monnet Ispat | Jampali OC | G12 Sized ROM | 15,000 | 1,068 | 1,388 | Sponge Iron |
| Ambuja Cement | Gevra OC(Stock) | G11 Sized ROM | 10,000 | 1,140 | 1,360 | Cement |
Currently, Indian currency has depreciated around 2% and is at 63.3 which was at 62.4 in the first week of Apr’15. Continuously depreciating INR against USD may adversely affect prices of imported material, which in turn may provide stability to domestic prices in near future.
On the other hand, Indian buyers are currently on the crossroads, struggling to decide whether to increase Coal import volume or not, as international prices are very competitive for domestic coal.
Imported Material offers
Currently, imported Indonesian 5000 GAR coal is offered at INR 4,400++/MT at Vizag port (basic duty and port charges included). Meanwhile, an east coast based trader, Agarwal Coal is offering South African RB2 (5000 NAR) coal at INR 4,850/MT at Gangavaram port, the company having about 12,000 MT un-booked quantity at port.
Leave a Reply