Indian Petcoke Market Becoming More Preferable With 10% Import Duty

With the imposition of 10% import duty on imports of Petcoke in India, domestic purchases of the refinery by-product have become more economically sensible for the buyers in the country. The Indian government has raised the duty from 2.5% by four times mainly to encourage usage of domestic Petcoke and bring down imports.

The domestic market has witnessed shrinkage in purchases, mainly in the Delhi/NCR, where only cement and lime industries were allowed to use Petcoke.

However, offers from the key international markets have not come down due to stronger international demand. According to the latest assessment, offers for Petcoke (6.5% Sulphur) from USA have hovered at around USD 108-109/MT CFR India, almost unchanged at the week-ago rates. At the same time, offers for Petcoke (9% Sulphur) from Saudi Arabia have gone up by around USD 3/MT, against the offers in the week last, to around USD 95-96/MT CFR India.

Source: CoalMint Research

In the home market, there has been no change in the ex-works prices of the Indian refineries during the last week. Towards the end of the first week of Jan’18, Reliance Industries Limited, the largest producer in India, had hiked its ex-works price to INR 8,000/MT; and simultaneously, Essar, the country’s second largest producer, also had raised its ex-works price to INR 7,985/MT.
Source: CoalMint Research

However, Mangalore Refinery and Petrochemicals Limited has kept its ex-works price unchanged at INR 6,950/MT, the rate to which was raised on 1Jan’18.

Upto the third week of Jan’18, there had been no spurt in landing of Petcoke import consignments at Indian ports as Indian buyers restricted themselves from booking major imports in Dec’17, when the uncertainty of using Petcoke in the future was looming. In the first half of that month, there was a prospect of the Supreme Court banning usage of Petcoke in India. However, that eventually did not happen.

Until 19Jan’18, ACC had imported 55,000 MT of Petcoke, Ambuja Cement had imported 49,270 MT, Dalmia Cement had imported 30,000 MT. There was altogether 240, 414 MT of Petcoke imports arriving to India.