Nayara Energy Limited (erstwhile Essar Oil), one of India’s top oil refineries, has sharply reduced its petroleum (pet) coke price by INR 4,150/tonne (t) against the price seen at the beginning of the month.
The company has revised its price to INR 16,664/t with effect from 23 Nov’21, over the last price of INR 20,814/t w.e.f. 1 Nov’21.
IndianOil lowers pet coke prices by 13-14% across all refineries
Indian Oil Corporation Ltd. (IOC), the country’s second-largest pet coke producer, has also made downward corrections in its prices across refineries w.e.f. 23 Nov’21.
Refinery-wise price revisions of IOC:
| Refinery | Prices (INR/t) | Change | |
| As on 23 Nov’21 | As on 1 Nov’21 | ||
| Koyali (Road) |
17,930 | 20,650 | -13% |
| Koyali (Rake) |
17,730 | 20,450 | -13% |
| Panipat (General) |
18,840 | 21,560 | -13% |
| Paradip (Road) |
17,130 | 19,850 | -14% |
| Paradip (Rake) |
16,930 | 19,650 | -14% |
| Haldia (Road) |
17,300 | 20,020 | -14% |
| Haldia (Rake) |
17,100 | 19,820 | -14% |
Reliance Industries Ltd (RIL), the country’s largest pet coke producer, is also heard to have offered discounts of INR 3,500-4,500/t on bulk purchases.
RIL’s pet coke price, widely considered as a benchmark by major cement manufacturers, currently remains at INR 20,871/t w.e.f. 1 Nov’21, – a y-o-y increase of 135% as against INR 8,851/t as on 1 Nov’20.
What has driven these price reductions?
These pet coke price reductions are understood to be primarily driven by the reduction in imported coal prices, which are used as alternatives to pet coke by cement manufacturers.
Although the imported coal market has been highly volatile in the past one month, the current average prices of South African, Australian and US thermal coal are relatively lower by around 20-25% (on per CV basis) against imported pet coke prices from USA and Saudi Arabia.
In case of imported pet coke, the prices have seen a stupendous rise of 120-125% from Jan’21 till date, but have stabilised since the past two weeks.
The price for US-origin (6.5% sulphur) is currently assessed at $220/t whereas Saudi-origin (9% sulphur) is at $217/t on CNF India basis.
Outlook
In the current scenario of an uncertain and volatile thermal coal market, Indian pet coke producing refineries would try to match up to imported coal prices and may reduce their offer prices till the pet coke prices become competitive for cement manufacturers.
However, an increase in pet coke prices would happen only if imported coal prices see a rise, like in the previous months, due to supply constraints.
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