Domestic Coal Auction Remains a Setback for SECL

Only 24% coal was sold in the monthly coal auction by SECL in Jul’16. While, more than half of the quantity was sold at base price.

SECL, a largest subsidiary of CIL, had concluded its monthly coal auction on three different dates, 4 Jul, 14 Jul and 15 Jul with a total quantity of 2.98 MnT. The response was not much attractive for the company as only 24% of the quantity was sold due to lack of participation.

In addition, about 0.7 MnT coal was sold, of which about 52% material sold at base prices. While in this auction, bid prices were more or less unaltered.

SteelMint assessed that since the beginning of 2016, SECL’s coal auction platform is getting poorer every month on the wake of increased domestic supply that is cheaper in quality. However at present, Indian domestic demand has fallen in monsoon, led to distressful coal sales in Jul’16.

Big participants in the auction
In the recent auction, out of the total sold quantity, more than 50% of coal was brought by top players such as BALCO, Godawari Power, Prakash Industries, Monnet Ispat & Energy, Phil Minerals Benefication & Energy, Paras Power etc.

1. Bharat Aluminum received total 0.3 MnT of coal from Gevra (G11), Dipka Expn (G10) and Manikpur (G12) OC mines. The quantity was brought with winning price of INR 1,164/MT, INR 1,466/MT and INR 1,092/MT respectively.
2. Prakash Industries received about 71,000 MT of coal from five different mines namely Vijay West (G5), Dipka Expn (G10), Rajgamar 4&5 (G5), Singhali (G5 SLK) and Gevra OC (G11), with a bid price of INR 2,920/MT, INR 1,466/MT, INR 3,160/MT, INR 2,770/MT and INR 1,174/MT respectively.
3. Monnet Ispat & Energy had brought about 32,800 MT coal from Dipka Expn (G10), Vijay West (G5) and Banki (G5 SLK), with a bid price of INR 1,466/MT, INR 2,930/MT and INR 2,770/MT distinctly.

Source: SteelMint
Quantity in MT