CIL’s coal production down by 5% m-o-m in Jun’20

India’s largest miner, Coal India Ltd (CIL) has reported a decline in monthly coal production for Jun’20, as it curtailed output to expedite reduction of surplus stock at mines.

Production in the month decreased 5% m-o-m to 39.2 mn t against 41.4 mn t in May’20, which was also down by 13% y-o-y from 45.08 mn t in Jun’19.

The miner had accumulated 74.56 mn t coal at the end of FY20, which was to be disposed-off in the beginning of current fiscal. However, due to lower demand arising from power sector and other industries, it has failed to lift coal supplies.

Consequently, output levels have been lowered, which attained a nine month low during Jun’20.

Subsidiary-wise production:

MCL remained the largest coal producer with an output of 10.56 mn t in Jun’20, but the production was down 6% on the month from 11.22 mn t in May’20.

In fact, out of the eight coal producing units, only BCCL and CCL had registered growth in monthly production. Whereas, all the subsidiaries had noted a fall in production on the y-o-y basis from levels seen in Jun’19.

Quantity in mn t 

It is pertinent to note that operations at CIL’s mining arm at Assam-NECL are temporarily suspended from 3 Jun’20, which yielded nil output during the month.

Improvement in coal dispatch:

CIL’s coal supply was supported by gradual increase in power demand during Jun’20, which has extended its rise on the monthly basis. Still, it remained 15% lower than the levels attained in Jun’19.

The company had recorded dispatch of 41.57 mn t coal during Jun’20, which increased 4% on the month from 39.9 mn t in May’20. Incidentally, higher dispatch than corresponding monthly production was noted for the first time since Oct’19 and has brought upon a subsequent drop in inventory levels.

Incidentally, coal stock of 75.31 mn t recorded at the end of Jun’20 is now at its lowest level for the current fiscal.