India: Coal imports drop by 14% m-o-m in first half of Dec'23
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Coal vessel arrivals at Indian ports dropped by 14% m-o-m in the first half of December 2023 (1-15 December) to 9.36 million tonnes (mnt) as against 10.84 mnt in the first half of November 2023, CoalMint's vessel line-up data showed.
State-run miner Coal India Ltd (CIL) continued its robust performance in terms of coal production in November 2023. CIL's production rose by 9% y-o-y to 66 million tonnes (mnt) in November 2023 as against 60.7 mnt in November 2022.
Indonesia holds highest share
Indonesian coal importers (1-15 December)
Qty in mnt
Out of the total imports in the first half of November, volumes of Indonesian coal were the highest at 4.26 mnt. Some major trading companies that bought Indonesian coal were Adani Enterprises (0.97 mnt) and Adani Power (0.87 mnt). About 3.65 mnt are expected to be imported in the second half of this month.
Imports dropped amid supply crunch due to congestion in the Panama Canal which also affected cargoes movement. Also, Indian buying remained on the lower side because of lower power demand and high domestic production. Indian end-users are mainly adopting a wait-and-watch approach in anticipation of a further price drop.
Australian coal importers (1-15 December)
Qty in mnt
Shipments from Australia drop
India's imports of Australian coal were recorded at 1.66 mnt. SAIL was the top buyer at 0.47 mnt followed by Tata Steel and Adani Power at 0.46 mnt and 0.17 mnt respectively. About 2.27 mnt of Australian coal are expected to arrive at Indian ports in the second half of December. The decline in imports is attributed to concerns about potential disruptions in coal shipping due to tropical cyclone, Jasper, in Australia. With supply constraints looming, there is anticipation of a further rise in spot prices.
Additionally, Empty coal train derails in New South Wales, Australia, causing a fire and closing a vital 1,400km rail line. Majority of coal shipments unaffected, but disruptions expected for Yancoal's Moolarben and Glencore's Ulan Coal.
South African coal importers (1-15 December)
Qty in mnt
Shipments from South Africa drop
Shipments from South Africa were recorded at 1.04 mnt in the period under review, dropping by 28% m-o-m as against 1.44 mnt in the same period in November. Balaji Malt was the largest importer at 0.19 mnt.
Despite logistical constraints, quotes remained under pressure, given rising freight rates and weaker demand for imported coal in India, driven by improving domestic supply. The situation with congestion involving coal trucks at other terminals of the port of Richards Bay is not yet improving, with suppliers facing high demurrage and complaining of profit losses.
Market participants noted a restrained market, indicating buyer hesitancy as they anticipated more favourable pricing conditions.
December is usually the month with the lowest trade volumes, and spot activity in the physical thermal coal market, experiencing a notable slowdown as well.
About 0.66 mnt of thermal coal are expected to be shipped in the second half of this month from South Africa.
Other exporters
Shipments from the US rose by 19% to 1.25 mnt in the period under review compared to 1.05 mnt in the first half of December. Shipments from Mozambique recorded a dropped 73% to 0.15 mnt compared with 0.55 mnt in the same period in November.
Outlook
It is anticipated that imports may rise in the near term amid falling temperature with rising demand for Indonesian coal. However, persistent congestion of coal trucks at Richards Bay port terminals do not see any immediate resolution.
