OfBusiness Coal Dailies

8th May’23

Price

• Prices remains stable. Prices at Navlakhi port of Grade 3600 GAR is Rs 6100/MT ($74), Grade 3800 GAR is Rs 6800/MT ($84), Grade 4800 GAR is Rs 8300/MT ($101), Grade 5400 GAR is Rs 10100/MT ($123) and at Kandla port of Grade 4600 GAR is Rs 8100/MT ($99), Grade 6000 GAR is Rs 11700/MT ($142).
• Australian coal price at Krishnapatnam port is Rs 13050/MT ($160) and at Gangavaram port is Rs 12700/MT ($155).
• South African RB3 coal price at Ennore port is Rs 11300/MT ($138). All prices are exclusive of GST.

Demand and Supply

• Indonesia is on its pace to increase coal production in 2023 to 690 million tons, marking a 1% growth from the 683 million tons it produced last year. It is also 4% higher than the 2022 target of 663 million tons.
• Indonesia also exported 494 million tons of coal in 2023, its record-high after the 459 million tons of coal exports in 2019. Export is projected to reach 500 million tons this year.
• The price of low-calorie coal in the Indonesian market is also going down due to limited import demand amidst the abundance of supply. The sharp decline in coal prices also affects coal miners in ASEAN, thus putting their income at risk.

News

• India announced five national goals at the UN Climate Change Conference in Glasgow (COP26) regarding its energy transition. Achieving a reduction in emission intensity by 45% as compared with 2005 levels by the end of this decade and achieving carbon neutrality by 2070 are the overarching ones.
• The other three goals of achieving 50% of power generation capacity from non-fossil fuels, 500 GW of non-fossil fuel-based capacity and a reduction of 1 billion tons of CO2 emissions by 2030 are in a way subsidiary goals. India’s strategy and progress in terms of energy transition goals by 2030 appear to be sound and have a high confidence level. India is likely to surpass its declared goals for this decade if it addresses a few remaining challenges.

OFB’s Opinion

• As Indonesian coal prices decrease, the global demand for it is expected to rise. This will likely lead to India importing larger quantities of coal, as the power sector’s consumption increases due to the current low production of domestic coal.