Will Indian domestic coal prices be able to compete imported coal prices if the current trend contimues?
28 Oct 2015
The Most of the Indian end-users are waiting for last minute purchase to enjoy every drop in price. Coal procurement managers are also encouraged this strategy to avoid blames from Senior officers in case prices drop further after the conclusion of any deal, said a Thermal Coal Consultant based out of Mumbai.
He further said that, In addition, Indian as well as International traders are lining up in front of each end-users seeking an opportunity to supply their spot cargo. Such situation makes Coal procurement Manages more challenging and enjoying.
On commenting on pricing, the consultant noted that, on the pricing, recently a client has finalized at $32 on CFR Paradip for a Geared Supramax 4200 GAR coal of Indonesian origin, delivery during Nov 2015.
On the RB1 coal, clients are getting offers below $55 CIF West Coast for a Cape vessel cargo delivery during Nov 15. In addition to the already squeezed prices, now clients are also demanding Disport quality final instead of load port final. The Indian buyers are also seeking a 90-180 days clean credit pressuring Traders to consider.
On the Domestic coal production, Coal India is producing at 9% higher and are aiming to reach 1Bln Ton by 2020 as per Govt. plan.
“ A question comes to my mind whether domestic coal will be able to compete against imported coal if current trend continue?”, the consultant asked.
The East Coast based power plants find Indonesian coal still substantially cheaper compared to Domestic coal prices. Similar case might be applied to West Coast Based Power Plants, he concluded.
source: http://coalspot.com