Coal prices in the latest domestic e-auction have boosted sharply amid the Supreme Court’s verdict on all Coal blocks allocated since 1993. Next hearing for de-allocation of over 200 Coal blocks will be held on 01 Sep, 2014.
Major Coal buyers along with others are worried; if the case judgment comes against Coal block holders, it will cripple entire power and related industry. In that situation, companies will be forced for imports.
The latest e-auction of 125,000 MT from SECL (South Eastern Coalfield Limited) has received high bids. Participants mentioned that bids have hiked by INR 500-1,000/MT from previous auction bids and about INR 1,000-2,000/MT from the reserved base price.
As per one participant, current bid prices are around 50% higher than base prices of SECL. 4600-4900 GCV (G9) grade Coal from Mahan II OC for 31,000 MT has received bid of around INR 3,400/MT against a base price of INR 1,572/MT.
Gayatri UG 5500-5800 GCV (G6) for 10,000 MT of Coal has received bid of upto INR 4,700/MT against a base price of INR 2,150/MT.
Another Coal mine Rajgamar 4&5 5800-6100 GCV (G5) Sized ROM for 9,000 MT Coal has received bid of INR 4,500/MT against base price of INR 2,800/MT.
SECL is the largest Coal producing company in the country, operating 89 mines in Chhattisgarh and Madhya Pradesh. Company has produced around 124 MnT of Coal in FY14, out of which around 13 MnT sold through e-auction.
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