BCCL’s exclusive coal auction receives dull response in Aug ’20

Bharat Coking Coal Ltd has witnessed subdued sales in exclusive auction concluded on 13 Aug ’20. Coal volume in the auction was substantially raised to 1,000,000 t against a lifting period valid for two months (Jul-Aug ’20), of which only 13% of the material accounting to 127,450 t was booked.

The company had managed almost two-fold increase in allocation from the previous auction held on Jun ’20, where 63,900 t coal was sold.

However, lower sale in terms of percentage allocation was a cause of concern comparable to the previous round where around 64% of the material was booked. Interestingly, the participation in the current round was opened for cement, ferro alloy and sponge iron sector apart from the hard coke manufacturers.

Source-wise Auction Result

Quantity in Metric Tonne (t) | Prices in INR/t

Due to financial hardship faced by customers, there was lesser appetite for coal offered via rail mode of dispatch, which require bidders to procure bulk of 4,000 t carried in a single rake. Consequently, no bids were seen for KDS-K and KDS-II collieries.

Moreover, lower participation can also be attributed to the absence of W-II grade of coking coal in the current round of auction, which had fetched bid premium in excess of INR 1500/t in the previous term.

Eventually, coal in the auction was sold at the base price, wherein response for non-coking coal was even more dismal. Notably, G5 grade from NT-ST colliery had seen booking of mere 3,100 t at base price of INR 2737/t.

Going forward, BCCL is expected to draw attention towards spot scheme of auction for stock liquidation, which had yielded better response during Jul ’20. Besides, special forward auction for power producers is also due after the previous month’s auction was cancelled.