Coal imports by Indian power utilities have decreased 15% m-o-m to 3.34 mn t in Aug ’20 as against 3.92 mn t in Jul ’20, data provided by power ministry showed. The volume was also marked 36% lower on the year from 5.25 mn t in Aug ’19.
Although seaborne coal prices have significantly fallen as a result of COVID-19, it failed to entice higher buying from the power producers due to sluggish electricity demand, which had registered a drop of 2% y-o-y to 109.83 BU in Aug ’20.
Intake of imported coal for blending with domestic coal remained dull, which plunged to its lowest total for the fiscal marked at 0.536 mn t in Aug ’20. Whereas, remaining bulk volume of 2.802 mn t was bought by utilities, which are designed to run on imported coal.
A sector-wise break-up indicates that imports by central and state sector plants recorded hefty fall, while the decline in private sector was limited to 6% during the month.
| Sector | Aug’20 | Jul’20 | % Change |
| Central | 0.04 | 0.09 | -54% |
| State | 0.18 | 0.52 | -66% |
| Private | 3.12 | 3.31 | -6% |
| Total | 3.34 | 3.92 | -15% |
Source: Power Ministry | Quantity in mn t
Adani’s Mundra plant with imports of 1.05 mn t was the largest coal receiver, followed by Tata Power (0.844 mn t) and Semb Corp Power (0.264 mn t).
During the first 5 months of FY ’21 (Apr-Aug ’20), imports by power plants have declined 37% y-o-y to 18.12 mn t compared with 28.69 mn t in Apr-Aug ’19 period.
Steady decline in coal inventories:
Power plants have lowered coal receipt from imports as well domestic sources to liquidate the excess stock. Data provided by CEA shows that their reduced coal consumption of 226.95 mn t during Apr-Aug ’20 was recorded 4% higher than the intake of 217.38 mn t in the period.
As a result of the constrained effort, coal inventory at plants have now come down to a 7-month low of 42.49 mn t at the end of Aug ’20, but power sector would still have to rely on considerable recovery in the economy in order to restore normalcy.
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