Coal inventories at critically low levels across the country
28 Aug 2014
Even as uncertainty over the allocation of coalfields intensifies, the situation on the inventory front is a cause for concern. Indian coal inventories are frighteningly low at the moment, according to Citi Research (see chart), enough for just six days of consumption across the country. Inventories are at nine days of consumption in the east, five days in the west and four days in the south. The monsoon has not been all that good, which compounds the problem because demand from the agriculture sector will increase as farmers use electric irrigation pumps. The number of power plants with critically low inventories has risen sharply in recent months to near historical highs, Citi Research says. “At the same time, electricity demand appears to be increasing and domestic coal supply remains challenged—even more so with this week’s Supreme Court ruling,” Citi Research said in a note on 27 August. A combination of all this is likely to lead to higher coal imports.
Source: http://www.livemint.com/