Pakistan Coal Imports Down 10% M-o-M in Aug’19

According to the vessel line-up data compiled by CoalMint Research, Pakistan’s coal import shipments have decreased 10% on the month to 1,147,726 MT in Aug’19 compared with 1,274,853 MT in Jul’19.

Pakistan’s coal imports have been subdued in CY19, which were expected to outgrow the volumes attained in the previous year.

During the first 8 months of CY19 (Jan-Aug’19), imports have reached 9,404,247 MT; down 9% Y-o-Y from 1,0376,076 MT noted in the corresponding period of CY18. Import volume had marked decline y-o-y for the 6th straight month, as it decreased 7% from 1,234,333 MT in Aug’18.

Notably, Pakistan’s coal demand from cement sector has eventually lowered, after witnessing poor sales in domestic as well as in export market.

Incidentally, a high electricity cost has made the cement production more expensive, which along with the additional duties on coal imports has even nullified the lower value of coal in the global markets.

Media reports have claimed that the government is envisaging further increase in electricity prices.

During Aug’19, coal intake from Pakistan’s cement sector had fell 43% M-o-M to 208,847 MT in Aug’19 compared with 363,803 MT in Jul’19. Whereas, coal import by power sector increased 35% on the month to 814,819 MT.

The devaluation of Pakistan’s currency against the US Dollar hovering above 155 Rupee for the past few months is unlikely to provide support to the cement industries, as it would ultimately lead to higher cost of coal imports.

The cement industry stakeholders urged the government to increase the custom duty on import of clinker in order to support the local manufacturers, besides reducing the cost of doing business in the country to encourage domestic sales.

Country-wise Coal Imports:

Pakistan’s coal importers had limited their sourcing specifically to South Africa and Indonesia for the fourth straight month. However, monthly coal receipt from both these origins had fell m-o-m during Aug’19.

Coal imports from South Africa slipped 2% M-o-M to 935,535 MT in Aug’19; intake from Indonesia was down 34% on the month to 212,191 MT.