India’s coal production will touch 900 million tonne (MT) this fiscal, CareEdge Ratings said in a report. It said that India’s coal requirement will likely hit 1.5 billion tonne by 2030 and to meet this, the country should scale up its production.
“CareEdge Research expects coal production to touch 850-900 MT by end of this fiscal, with further upside potential in the medium-term. This is likely to be driven by CIL’s expected ramp-up in production to achieve the Ministry of Coal’s target to produce 1.3 billion tonne by FY25 and 1.5 billion tonne by FY30,” Tanvi Shah, director, CareEdge Advisory & Research, said.
“The production will further be supported by the gradual commissioning of the captive and commercial coal mines auctioned by the government. Despatches to the power sector are likely to inch up further as demand from coal-based power plants remains high to meet the country’s rising energy requirements,” Shah added.
According to the CareEdge, India’s coal production reached a new milestone of 524 MT during April-November 2022, a 17.1% year-on-year (YoY) growth, driven by 16.8% YoY increase in Coal India’s output.
“The power sector continued to be the largest consumer of domestic coal, accounting for 85% of the total despatches of 588 MT during YTD FY23,” it added.
Coal imports surged 25.7% YoY to 154.7 MT during April-October, despite high import prices due to high demand for non-coking coal from the power sector.
Global coal prices have been on an upward trajectory since November 2021 due to geopolitical tensions which have caused significant price fluctuations since the beginning of this fiscal.
For the quarter ended September, benchmark Australian, Indonesian and South African coal prices had surged a staggering 144%, 142% and 139% YoY, respectively, and remained high in October and November, too.
In FY23, coal prices are expected to remain elevated due to geopolitical tensions and global inflationary pressures, CareEdge said.
