Coal news and updates

RIL cuts pet coke prices by Rs 100/ton for July loading

July 8: Reliance Industries Ltd (RIL), India’s largest petroleum coke producer, has reduced by Rs 100 per ton the ex-refinery price of fuel-grade petroleum coke for bulk buyers for loading in July 2014, an industry source said.

This was the second month running when the company had resorted to cut in prices after effecting a similar cut for loading in June 2014, the sources said.

The ex-refinery price for bulk buyers for loading in July will now be Rs 6,550 per ton for bulk customers compared to Rs 6,650 in June and Rs 6,750 per ton in May.

The cut in prices in July was largely on account of a slightly soft demand due to the monsoons, they said.

“Domestic pet coke prices are likely to remain soft in August as well due to low demand as well as a softness in imported pet coke prices,” they added.

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

“Not only has the price of imported pet coke fallen to $101 per ton CFR India from $105 per ton around three months back, the Indian currency too has depreciated to around Rs 59 to the US dollar from a high of around Rs 65 back then,” the source said.

“As the cost of using imported pet coke came down, domestic refiners opted to reduce their prices to retain their customers,” an official from a cement company told ICMW.

Earlier, in April, RIL had increased the price by Rs 100 per to Rs 6,750 per ton after rolling it over in March 2014. The company had increased the price by Rs 150 per ton to Rs 6,650 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 6,500 per ton. The company had increased the price by Rs 300 per ton to Rs 6,300 per ton in September 2013 to keep parity with the imported price which had increased in view of the sharp depreciation in the Indian currency.

This means, the company increased the price of pet coke by Rs 850 per ton from a low of Rs 5,900 per ton prevailing in June 2013 to Rs 6,750 per ton in April 2014. Compared to Rs 5,700 per ton in February 2013, the price in May 2014 is up by Rs 1,050 per ton.

Overall demand for pet coke in the country has increased a bit compared to a year back even as there was not much increase in demand from cement makers in May 2014 due to the general election in the country which had reduced supplies to the infrastructure sector. Incidentally, the cement sector is the biggest consumer of pet coke in India.

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 their July 2014 loading prices is concerned, feel sources.