Coal news and updates

RIL cuts pet coke price by Rs 100/ton for December loading

December 03: Reliance Industries Ltd, which had rolled over the ex-refinery price of pet coke for loading in November after increasing it by Rs 100 per ton in October after continuously reducing the price by same margin in previous four months, has again reduced the price by Rs 100 per ton for loading in December, industry sources said.

“International pet coke prices continue to remain unchanged, but a softness in freight rates appears to have encouraged the refiner to reduce the price by Rs 100 per ton for December loading,” a source said.

“Overall, demand and supply situation of pet coke in India remained unchanged and in order to better serve its customers, RIL has resorted for the cut,” said another source.

With this the ex-refinery price for bulk consumers for loading in December has been fixed at Rs 6350 per ton, he said.

Incidentally, the price of pet coke in international markets remained unchanged from the beginning of October i.e. there was no change in prices for the last more than two months.

Many in the industry were expecting a sharp reduction in pet coke prices by RIL for loading in December because of steep decline in crude oil prices in international market to about $68 per barrel for India basket, down from about $106.02 per bbl as on May 2, 2014.

The company had started reducing prices in June as it implemented a reduction of Rs 100 per ton in each months of July, August and September.

The ex-refinery price for bulk buyers for loading in October has been fixed at Rs 6350 per ton as compared to Rs 6450 per ton October, Rs 6350 per ton in September, Rs 6450 per ton in August, Rs 6550 per ton in July, Rs 6650 per ton in June and Rs 6750 per ton in May.

Though information from other refiners like Essar, HPCL and BORL who generally follow RIL in fixing their pet coke price is not available at present, they are also likely to follow the leader so far as fixing December 2014 loading prices is concerned, sources feel.

The increase in prices in October was largely due to anticipation of higher demand from cement makers who expected a higher demand for cement post monsoon and also because of slight firmness to the extent of $1-3 per ton in imported pet coke prices, they said.

However, the current economic situation in India does not provide any indication of a betterment in demand-supply situation from main pet coke consuming sector, an official of a leading cement company said.

In June, the cut in price was basically prompted by appreciation in Indian Rupee that has made imports cheaper, sources said.

The current price of imported pet coke is around $92-94 per ton CFR India, down by $1.00 per ton from November and down from $98.00 per ton in June, but up from $92-93 per ton quoted at the end of August.

Earlier, in April RIL had increased the price by Rs 100 per to Rs 6750 per ton after rolling it over in March 2014. The company had increased the price by Rs 150 per ton to Rs 6650 per ton for February loading.

Prior to February 2014, RIL had last increased the price by Rs 200 per ton in November 2013 to Rs 6500 per ton. The company had increased the price by Rs 300 per ton to Rs 6300 per ton in September 2013 to keep parity with imported price which had increased in view of sharp depreciation in Indian currency.

This means, the company has increased the price of pet coke by Rs 850 per ton from a low of Rs 5900 per ton prevailing in June 2013 to Rs 6750 per ton in April 2014. Compared to Rs 5700 per ton price in February 2013, the price in December 2014 is up by Rs 650 per ton.